Romney paid a shitload of foreign taxes in 05', 06' and 07'

[progree]

5. Thanks for the great explanation. What about a U.S. company that does a lot of business overseas?

Pretty much anyone who has a portfolio, even just a mutual fund, will somewhere along the way end up paying some foreign taxes. Usually this is paid by the mutual fund company on gains from sales of foreign stock within the mutual fund.

Basically that means that money earned and taxed at the source is treated as a deduction so that there will not be double taxation The money was basically earned outside of the US and so it has been taxed at the source.

I'm just wondering ... if someone invests in say an S&P 500 index fund, such as Vanguard 500 Index Investor (VFINX), which is roughly the 500 biggest U.S. corporations, will that result in foreign tax payments -- since many S&P 500 companies do a lot of business overseas and make a lot of their profits overseas? Or for that matter, if someone owns stock of a good 'ol U.S. company like General Electric, will that result in foreign tax payments that must be declared on one's tax return?

What I'm trying to get at, is foreign tax payments an indication that one is investing in foreign companies, either directly (like, say Toyota stock) or indirectly, like some, oh, Euro-Pacific Growth mutual fund? Thanks!!