It's income to your guy. IMHO most of the stuff brokers report there is also subject to NIIT, so if that applies, you should make additional entries in Screen 45.3 National Financial Services is the payor of record for multiple broker-dealers who gave your client taxable income. Same as they're the payor of record for multiple corporations who gave your client taxable dividends.

This is the sort of thing where emailing the file to support (Tools, Communications, Service Requests / Lacerte Email) is the way to go. Someone can actually find where things went wrong with your file. I will say that I haven't had any issues with Lacerte footing in that situation, although mine might have been long-term, rather than short.

Obviously not an issue for returns where the taxpayer is eligible for the election not to file an 1116, although the instructions clearly say "You are still required to take into account the general rules for determining whether a tax is creditable." One of the things I've learned in trying to prepare some larger-dollar returns correctly is that Switzerland withholds at 35%, despite the treaty rate being 15%. 

I also have a custom filter in Lacerte that looks like this: Where statuses 12 and 13 are "To Be Delivered" and "Final" on my system. It tells me what returns I think are done enough to sign, that haven't been accepted by the IRS yet. (This setup is not sufficient to identify amended returns where I'm waiting for an ack, or state-only filings. But I have few enough of those that I don't mind them hanging out on the list in perpetuity.)    

1) "So how do I allocate?" You look through the million pages of 1099 detail and figure out what specific qualified dividends foreign taxes were withheld from. I initially thought that cursing the broker as I worked would be helpful, but billing the client for the extra time needed seems to make it less miserable. (I upgraded my version of Acrobat this year, too, and exporting the entire thing to Excel and then manipulating the relevant rows is less tedious than typing the numbers by hand.) 2) "I would assume that I put 1088 in the "percentage foreign or amount - total ordinary" field, but when I do that the numbers on the 1116 do not match the actual amount of foreign dividends!" You also need an amount in the qualified and capital gains distributions fields directly below that one. If none, enter -1. Don't forget that the IRS currently wants everything broken out country by country, too.

https://www.marylandtaxes.gov/forms/Personal_Tax_Tips/tip56.pdf https://cpadelaware.net/f/if-i-work-in-pa-nj-or-md-but-live-in-de-do-i-pay-taxes-in-both For Delaware, you calculate your return as both a non-resident and a resident, and file whichever form gets you a better answer. https://revenuefiles.delaware.gov/2023/PIT-RES_TY23_2023-01_Instructions.pdf https://revenuefiles.delaware.gov/2023/PIT-NON_TY23_2023-01_Instructions.pdf For Maryland, you file both a resident and a non-resident return. https://www.marylandtaxes.gov/forms/23_forms/Nonresident-Booklet.pdf https://www.marylandtaxes.gov/forms/23_forms/Resident-Booklet.pdf (MD is sure this is the correct link, but it isn't working for me. I don't have any other official source of the forms instructions, though.)

Inherited stuff has different rules.    Fortunately, https://www.tsp.gov/for-beneficiaries/beneficiary-distributions/ indicates that inherited amounts are eligible to be rolled into an inherited IRA.

You have both a worksheet and a diagnostic showing that their income is high enough their ability to make Roth contributions is phased out. You should advise them to correct their excess Roth contributions prior to 4/15.