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New Member
posted Oct 16, 2023 7:04:30 PM

Can I deduct 75k I earned working as a contractor overseas, which it is tax deductible for a max of 108k? Did I do something wrong?

How can I deduct government income earned overseas?

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1 Best answer
Level 15
Oct 16, 2023 8:22:49 PM

@nomad012 , if you are a US person ( citizen/ GreenCard ) and your tax home was foreign, then yes you should be able to use foreign earned  income exclusion ( wages  and/or self-employed income ).

 

You fill out the schedule C  for the self-employed income, deduct all allowed expenses associated  with this income;  and then under  personal income, choose  "I will select what I work on ", then from the drop down list of types of incomes,  near the bottom you will see  Foreign Earned Income Exclusion -- select this and follow   through.  Just make sure that the income is equal to the net income  on Schedule-C.  This  should allow you to choose foreign income exclusion --- form 2555.   You will here have to choose  "Physical Presence" and answer the questions.

 

Note---- if your self-employed income is from US govt. or any of its departments  ( DoD etc. ) , this income is not excludable nor taxable  in your host country.

 

Is there more I can do for you ?

 

 

1 Replies
Level 15
Oct 16, 2023 8:22:49 PM

@nomad012 , if you are a US person ( citizen/ GreenCard ) and your tax home was foreign, then yes you should be able to use foreign earned  income exclusion ( wages  and/or self-employed income ).

 

You fill out the schedule C  for the self-employed income, deduct all allowed expenses associated  with this income;  and then under  personal income, choose  "I will select what I work on ", then from the drop down list of types of incomes,  near the bottom you will see  Foreign Earned Income Exclusion -- select this and follow   through.  Just make sure that the income is equal to the net income  on Schedule-C.  This  should allow you to choose foreign income exclusion --- form 2555.   You will here have to choose  "Physical Presence" and answer the questions.

 

Note---- if your self-employed income is from US govt. or any of its departments  ( DoD etc. ) , this income is not excludable nor taxable  in your host country.

 

Is there more I can do for you ?