TP receives a 1099 that states he has foreign source dividends. This seems easy enough to report, but I was wondering: what is the definition of foreign source income? If you have capital gain distributions from a foreign source, they are included in the Form 1116 calculation, but what if you sell the US based International Mutual Fund that generates a taxable capital gain? Is this foreign source income? If not, why? How come capital gain distributions are treated differently than sale of stock? This stock is held through Charles Schwab and not from a foreign broker. Does it make a difference if it was held via foreign broker?
Apologize in advance if this is a dumb question.