I live overseas and all of my foreign earned income is excluded from US taxes. According to the IRS website, I should be able to ignore the foreign income deduction for the purposes of calculating my eligibility for an IRA contribution (see below). TurboTax does not make this adjustment, so it is telling me I am not eligible to make an IRA contribution. Does anyone know a work-around for this?
"If you exclude income under the foreign earned income exclusion or the foreign housing exclusion, you must add back the excluded amounts in determining your compensation for purposes of the IRA limits. Likewise, for purposes of determining the IRA limits, do not reduce your compensation by any foreign housing deductions." https://www.irs.gov/individuals/international-taxpayers/individual-retirement-arrangements
