A large portion of the payout was marked by my employer as non-taxable.
Then they show the tax paid on the rest of it.
I guess my question involves, since this is a voluntary redundancy, with payment for years in service, long-service leave, sick and vacation leave not taken (and also superannuation paid), it turns out to be more than my usual annual income. I assume that even though Oz isn't taxing a portion, that the US will be taxing it all anyway. The only credit I get is the tax paid to Oz, and the only income that is taxable in US now is the amount that exceeds the Oz/US treaty limit.
I have never taken a housing exemption before because my income was always within the the treaty limit so it wasn't necessary to add more info. For 2021, though, would that be appropriate? (I may be conflating that with homeowner expenses that should be listed in itemized deductions.)
Or, do I just use my Oz mortgage and normal housing expenses that are deductible in the US to lower my tax liability? (something I never had to do before either because of my income level).
Thanks much for any insight.
