Foregin Earned Income Exclusion Deduction

Last year (2020), I met the bonified residence test being absent from the US for the entire year 2020.

This year, I can't use the bonified residence test as we were present in the US for part of the year.

Regarding the physical present test for this year here are my two questions:

1. Can I overlap my 12 mo period (BRT) with the physical presence test? For example, can I use the period from July 1, 2020 to July 1, 2021 (eventhough I used the BRT from Jan1-Dec 31 2020)?

2. Or, could I use the period of Dec 12, 2021 - Dec 12, 2022 for my 12 month period? We plan to stay overseas and not return home until 2023.

For reference our time outside the US has been from Aug 2019-July 2021, then we came home arriving on July 1, 2021 and departed back overseas on Dec 12, 2021.

Thank You

110

Expert Alumni

Feb 7, 2022 5:15:49 PM

Yes, you can overlap your bonified residence test (BRT) days to calculate if you qualify under the physical presence test.

" Generally, to meet the physical presence test, you must be physically present in a foreign country or countries for at least 330 full days during a 12-month period including some part of the year at issue. You can count days you spent abroad for any reason, so long as your tax home is in a foreign country." REF: IRS Foreign Earned Income Exclusion - Physical Presence Test.

This link Foreign Earned Income Exclusion - Physical Presence Test has information you may find useful.

Level 3

Feb 10, 2022 2:52:51 AM

Lenoard,

Thanks for the clarification regarding the BRT and PPT.

Regards

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Foregin Earned Income Exclusion Deduction