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1 Best answer

Accepted Solutions
DJS
Level 8

-

This may apply to you.

The Foreign Earned Income Exclusion

US citizens and green card holders are still required to file US taxes from abroad, however thankfully there are some exclusions that reduce (or for most expats eliminate) their US tax liability.

In particular, the Foreign Earned Income Exclusion lets expats who can prove that they live abroad in one of two ways not pay US tax on about $100,000 of their income. To qualify, expats must prove either that they spent at least 330 days outside the US in a 365 day period that overlaps with the tax year, or prove that they are a permanent resident in another country.

To claim the Foreign Earned Income Exclusion, expats have to file form 2555 with their US tax return.

 

Also: 

Even if you satisfy the substantial presence test, you can still avoid paying U.S. income taxes if you:

  • are present in the United States for less than 183 days during the current year
  • have not applied for a green card
  • have a closer connection with a foreign country than with the U.S., and
  • maintain a tax home in this foreign country during the year.

To win with this test, you must show the IRS that you maintain more significant contacts with a foreign country than with the United States.

Answers are correct to the best of my ability but do not constitute legal or tax advice.
**If this post is helpful please click on "thumbs up"**

View solution in original post

1 Reply
DJS
Level 8

-

This may apply to you.

The Foreign Earned Income Exclusion

US citizens and green card holders are still required to file US taxes from abroad, however thankfully there are some exclusions that reduce (or for most expats eliminate) their US tax liability.

In particular, the Foreign Earned Income Exclusion lets expats who can prove that they live abroad in one of two ways not pay US tax on about $100,000 of their income. To qualify, expats must prove either that they spent at least 330 days outside the US in a 365 day period that overlaps with the tax year, or prove that they are a permanent resident in another country.

To claim the Foreign Earned Income Exclusion, expats have to file form 2555 with their US tax return.

 

Also: 

Even if you satisfy the substantial presence test, you can still avoid paying U.S. income taxes if you:

  • are present in the United States for less than 183 days during the current year
  • have not applied for a green card
  • have a closer connection with a foreign country than with the U.S., and
  • maintain a tax home in this foreign country during the year.

To win with this test, you must show the IRS that you maintain more significant contacts with a foreign country than with the United States.

Answers are correct to the best of my ability but do not constitute legal or tax advice.
**If this post is helpful please click on "thumbs up"**

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