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etrahelf
New Member

I moved to the UK in Sept and left my job. I started working for a UK job in Nov and was only paid once in the UK. It was below 6000 - does this need reported?

Due to when I started working, I only got one paycheck in 2020 for my job in the UK. Since I moved to the UK in September, I also don't qualify for foreign income earned exclusions. Would it be better for me to file an amended return or ask for an extension until I meet the 330 days required for the exclusion.
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1 Reply
jtax
Level 10

I moved to the UK in Sept and left my job. I started working for a UK job in Nov and was only paid once in the UK. It was below 6000 - does this need reported?

Where did you get the < $6k don't need to file/report number from? 

 

If you had other income before you moved such that you have to file, you will have to include your UK income.

 

You might wait until you meet the 330 day test for the foreign earned income exclusion. But be sure you can still file in time. (E.g. does filing an extension until 10/15 get you 330 days? If not I'm not sure what to do. Perhaps you can file and then amend, but I don't know without doing more research.)

 

An alternative that is worth considering every year is to skip the foreign earned income exclusion and do your taxes claiming a foreign tax credit  (FTC) for any taxes paid to the UK on your income there. (income taxes not social security/medical of course). Usually US taxes are so much lower than other countries that you can wipe you your US tax liability with the FTC. However the FTC is limited by the ratio of foreign income to worldwide income. So people will only a little bit of foreign income might not get to use all of the FTC. 

 

It is all so complicated that I think it best to mock up each scenario and see which gives you the best result. That is easiest to do if you use the desktop software and split into separate files (after you have entered/finalized all of your non-foreign income).

 

 

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