FEIE for 2023 is 120,000$ and is going to be 126,500$ for 2024, I am paying no local income taxes where I live.
On the other end the local cost of living is high as is the rent, so the SS tax on what we get paid by the s corp is 1542$ (15.3%) monthly the rest of the expenses are those required to maintain the corporation with the CPA.
My wife and I are the only employees and I own the corporation.
The tax return for 2023 is being prepared by my CPA as there were many other factors.
Perhaps my question was not formulated correctly, going forward for the next tax return all I needed to know was what I would need to file a straightforward 1040 if my only income is what I make from a foreign source outside the USA living abroad
Would my taxable AGI result from:
Income, minus FEIE (first 126,500$), minus standard deduction, minus IRA contributions (traditional) (lowering the AGI from the top for bracket calculation).
Theoretical numbers:
income 210000-
FEIE. 126500=
83500.
For tax bracket. 210000 (22% as income after FEIE is taxed at the top)
Residual after FEIE 83500-
Standard deduction. 29200-
IRA contr (traditional). 16000=
Tax liable AGI 38300 @22%= 8426
That is 8426$ vs 18504$+expenses that I would not need and I can invest that in other ways.
