I have foreign earned income from one employer (below the maximum threshold for exclusion) and was a resident of that foreign country the entire year 2019 by both physical presence and bona fide tests. I am not taking any foreign housing deductions. TurboTax Online confirms I can exclude all foreign income with the message at the end of the section: "Congratulations! Your foreign earned income exclusion is $X. You will not pay U.S. tax on this amount" (where X is the total of my foreign income).
However, the amount of tax I owe is higher for federal and state after completing this section. If I delete the foreign earned income or reduce the amount to test what's going on, the tax owed for federal and state both decrease. This leads me to believe it is not actually being excluded fully. Can anyone provide insight? Thanks in advance.
