Switch from FTC (Foreign Tax Credit) to FEIE (Foreign Earned Income Exclusion)

[Kosetife]

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

[DaveF1006]

No because only foreign earned income qualifies for the FEIE.  Social Security is considered unearned income and does not qualify for the FEIE exclusion.

[Kosetife]

Thanks very much for your reply which confirms what I thought,  but not being and expert I needed a confirmation like yours . You have been very kind and efficient with your prompt accurate reply . All the best !!!