How to include foreign income in tax return?

@pk

If you are a US citizen or US resident you are required to report your worldwide income on a federal tax return.

 

See this TurboTax Tax Tips website for US citizens working abroad - https://turbotax.intuit.com/tax-tips/general/taxes-for-expats/L26keX1RV

 

To enter Foreign Earned Income -

Click on Federal Taxes (Personal using Home and Business)
Click on Wages and Income (Personal Income using Home and Business)
Click on I'll choose what I work on (if shown)
Scroll down to Less Common Income
On Foreign Earned Income and Exclusion, click on the start or update button

 

Or enter foreign income in the Search box located in the upper right of the program screen. Click on Jump to foreign income

@priyamehrotra ,  Namaste Priya ji  Agreeing with @DoninGA  for the Foreign earned income  recoignition, would like to add a few other items

(a) If you are an US person  citizen,, living and earning abroad,  AND  being taxed by both US ( home country ) and Foreign Taxing authority ( Host country / countries) with which US has a Tax treaty, you can mitigate the  effects of double taxation  by excluding a portion of your foreign earned  income ( including self-employment income ).  Taxes on any un-excluded  income is eligible for foreign tax credit or deduction.  This  ( the exclusion ) is done , as articulated by my colleague @DoninGA  by using form 2555.

(b) The form 2555 and the exclusion amount . ( ( which is adjusted each year based on US CPI ). requires you to pass  either Physical Presence Test --- present abroad  for a full 330 days  in any consecutive  12  month  test period ) OR Bona-fide Resident ( has to be approved by the IRS ).  There are many other "ands, ifs and buts" which TurboTax will walk you through.

(c)  The tax on any unexcluded income  ( active )  by a foreign taxing authority  and/ or passive income is eligible for credit ( form 1116 -- under  deductions and credits  tab  ) or deduction if you itemize.  Noite that the foreign tax credit is limited  essentially by a ratio of foreign  sourced income to world income.  Unallowed  foreign tax credit can be carried back one year or forward   as long as there is foreign source income --- it is generally an asymptotic affair 

(d) If the US person is a Green Card holder  or a dual citizen,  then there may be additional items to be aware of  and definitely a perusal of the tax treaty between US and that host country  is strongly suggested.

 

Does this cover sufficiently your situation  and/or do you need more help/info on this ?

 

Namaste ji

 

pk