Yes. United States citizens and resident aliens are taxed on their
worldwide income, whether the person lives inside or outside of the
United States. However, qualifying U.S. citizens and resident aliens who
live and work abroad may be able to exclude from their income all or
part of their foreign salary or wages, or amounts received as
compensation for their personal services. In addition, they may also
qualify to exclude or deduct certain foreign housing costs.
A common misconception that contributes to the international tax gap
is that this potentially excludable foreign earned income is exempt
income not reportable on a US tax return. In fact, only a qualifying individual with qualifying income may elect to exclude foreign earned income and this exclusion applies only if a tax return is filed and the income is reported.
To claim the foreign earned income exclusion, the foreign housing
exclusion, or the foreign housing deduction, you must have foreign
earned income, your tax home must be in a
foreign country, and you must be one of the following:
- A U.S. citizen who is a bona fide resident of a
foreign country or countries for an uninterrupted period that includes
an entire tax year,
- A U.S. resident alien who is a citizen or national of a country with
which the United States has an income tax treaty in effect and who is a
bona fide resident of a foreign country or countries for an
uninterrupted period that includes an entire tax year, or
- A U.S. citizen or a U.S. resident alien who is
physically present in a foreign country or countries for at least 330
full days during any period of 12 consecutive months.
Working in a foreign country for a few weeks would not qualify.
