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I work as an overseas security contractor in Iraq. I pay Iraqi taxes and am filing as a bonafide resident. I qualify for the Foreign Earned Income Tax Exclusion.

 
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3 Replies
pk
Level 15
Level 15

I work as an overseas security contractor in Iraq. I pay Iraqi taxes and am filing as a bonafide resident. I qualify for the Foreign Earned Income Tax Exclusion.

Is this your first year filing as Bona-fide resident ? did you get IRS approval for that status?

Or did you mean you qualify under physical presence test?

Are you US citizen/resident( green card )? When did you leave the USA?  Are you employed by local entity or by US DoD ?

I work as an overseas security contractor in Iraq. I pay Iraqi taxes and am filing as a bonafide resident. I qualify for the Foreign Earned Income Tax Exclusion.

Not the asker, but same question with more details: Yes, is IRS approval needed before filing? I qualify under the conditions in the physical presence test. Citizen, was outside the US for 359 days in the calendar year (plus several months immediately before and after), not DoD, and pay Iraq taxes. Also, can I use the foreign tax credit for my income that's taxed after the exclusion?
pk
Level 15
Level 15

I work as an overseas security contractor in Iraq. I pay Iraqi taxes and am filing as a bonafide resident. I qualify for the Foreign Earned Income Tax Exclusion.

Most expats use the physical presence test  and since you have more than 330 days  in a continuous 12 month test period, you indeed can declare your tax home to be abroad ( Iraq). This will allow you to claim foreign earned income exclusion.  
Note that -- for example if you went abroad on 10/01/2017 and continued to be  abroad till 05/31/2019 -- then your text period could be as early as 10/01/2017 through 09/30/2018 --- thus your foreign earned income for the period 10/01/2017 through 12/31/2017 would be eligible for exclusion . Additionally your  foreign wages for the tax year 2018 and part of 2019  can also be eligible for  exclusion.  
Any foreign earned income that is not so excluded  and taxed by both USA and the local  taxing authority would be eligible for foreign tax credit.
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