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Returning Member
posted Apr 20, 2025 6:51:00 AM

I have been in China for 365 days. I submitted my FEI. The IRS asked me for a Schedule C. If I put it, it says I owe $. Do I put income in FEI and put $0 for Schedule C?

I originally had my income only under the FEI (Foreign Earned Income). The IRS said I need to put a Schedule C. I put my income again in the Schedule C, but then Turbotax said I owed Federal and State taxes, but I have not lived in the USA for 365+ days. I now put $0 for my Schedule C since I made all my money as FEI (all made in a foreign account and already paid taxes in China). Am I supposed to put my actual income into the Schedule C and the Foreign Earned Income and Exclusion parts, or am I supposed to only put the income once in the FEI section?

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1 Replies
Level 15
Apr 20, 2025 11:04:39 AM

If you are self-employed, you will still owe self-employment tax (Social Security and Medicare tax).

 

If have any income that does not fall under the exclusion, that will likely result in income tax.

 

As for your actual question, I'm not sure how TurboTax is set up.  Logically, you should enter it on Schedule C then as a second step in the foreign exclusion section indicate that is the amount that is eligible to be excluded.  But I am not certain how TurboTax is set up.