pk
Level 15
Level 15

Get your taxes done using TurboTax

@Workbank , assuming

(a) that you are US person  ( citizen/ Green Card ),  

(b) that you are residing  in a country which has  tax treaty with the US

(c) that  you meet the general requirements of  Physical Presence  Test;

(d) that your  test period for the Physical Presence Test is the calendar year 2020 (i.e. 01/01/2020 thtough 12/31/2020 )

(e) that you wish to   exclude foreign earned income

(f) that you are self employed  ( or a wage earner  and employed by a local entity )

 

Then  you report your gross self-employment  ( and/or  sole  proprietor )  on Schedule C as if you were operating in the USA.   Thus you report your  gross of 95K ( your example ) and expenses  of 27K ( your example ).  This will allow TurboTax to fill out the Schedule C with a net income of  68K and a Schedule-SE for  SECA taxes  approx 10K.   This will now flow to form 1040  showing an income of 68K  ( net income ) as business  earnings and also an adjustment of  5K   ( 50% of the SECA taxes ) i.e. your AGI would be  63K  ( 68K less  5K ).  Your taxable income  would be 68K less  your standard deduction ( if that is what you choose to use ).

Thereafter you  choose  "foreign income and exclusion "  under   "less common  incomes" category.  Here you say that you have foreign income you want to exclude  -- the income  is 68K  ( the net foreign self-employed income  ) -- this will lead to form 2555.  Make sure that the form 2555 shows the gross income for exclusion   as 68K ( per your example ).

 

More I can do for you ?