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Switch from FTC (Foreign Tax Credit) to FEIE (Foreign Earned Income Exclusion)
1.- I’m a green card holder living in the US (since I retired almost 7 years ago in my country) on my “foreign sourced social security income”. I used to claim Foreign Tax Credit ( FTC) because income tax is higher in the sourced country than in the US.
2.- In 2022 I was exempted by the sourced country and my foreign social security income was not longer taxable at source since then.
3.- Anyway, taking into account that foreign social security benefits are taxable in the US, I wonder if I am entitled to switch from Foreign Tax Credit (FTC) to Foreign Earned Income Exclusion (FEIE)?
4.- I have accrued foreign tax credit ( carryover / carryforward) that I can use. But taking into account that my foreign social security income is lower than the FEIE threshold, I prefer FEIE instead of FTC . With all that said, my question is: Can my “foreign social security income” be considered a “foreign earned income” ? .
I don’t think so but I can be wrong. I am not living and working overseas, but I lived and worked overseas during 40 years and because of that I was entitled to have my social security income from my country.
Summarizing : Can I switch from Foreign Tax Credit (FTC) to Foreign Earned Income Exclusion (FEIE)?
Thank very much in advance.
Looking forward to hearing from someone, I remain