Lili, Inc., a domestic corporation, operates a branch in France. The earnings record of the branch is as follows.

For 2013–2016, Lili, Inc., reports U.S.-source taxable income of $500,000 each year.
What is the allowed FTC for 2016? Assume a 35% U.S. tax rate.

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Year 2013 2014 2015 2016 Taxable Income (Loss) ($ 25,000) (40,000) (10,000) 120,000 Foreign Taxes Paid $ -0- -0- -0- 40,000