and they itemize deductions. Should they claim the foreign tax credit or a deduction for foreign taxes on their Schedule A? The foreign tax deduction will result in a \$ X tax benefit where as claiming the foreign tax credit yields a $ tax benefit. Therefore, the taxpayers should! Feedback V Check My Work country. Taxpayers may make an annual election to claim a deduction instead of a credit for the foreign taxes. to the IRS and to the taxpayer along with the dividend income from the stock or the mutual fund