I need help understanding part of Form 2555 (FEIE), specifically Part III, Physical Presence Test. How do I count days? The IRS explanation is confusing.

[Garbanzor29]

They say,
"A full day is a period of 24 consecutive hours, beginning and ending at midnight. You must spend the full day in a foreign country or countries for that day to be counted. ...Example: You leave the United States for France by air on June 10. You arrive in France at 9:00 a.m. on June 11. Your first full day in France is June 12."

My situation:
Arrived USA: August 7th
Left USA:  August 14th

Specific details:
August 7:  Drove from Canada and entered the USA at 2pm.
August 7th

[ErnieS0]

As you listed in your post, the IRS says you can count a full day for the physical presence test if you spend the full 24 hours in the other country.

In your situation, I'm assuming you are trying to count full days outside the US. I'm also assuming your travel was complete within one day.

You could not count eight days are being physically present in Canada for a full day (7 August to 14 August) because you did not spend a 24 hour period in Canada in any of those days.

See Foreign Earned Income Exclusion - Physical Presence Test

[Garbanzor29]

I think my original message got chopped off. Actually, it's just the reverse... I need to know, by IRS reckoning, how many days I was in the USA. 

QUESTIONS: Using the IRS method of counting days (above),
- How many "full days" was I present in the USA?
- How many days was I in the USA on business?

August 7: Drove from Canada and entered the USA at 2pm.
August 7th & 8th: Spent personal time at grandparents' house.
August 9th:  9am, departed by car for another state for business.
August 9th - 13th Spent time on business.  On the 13th at 5pm drove to grandparents' home (again in a different state).
August 14th: Spent personal time with grandparents; left USA and re-entered Canada around 5pm.

Thanks!

[DaveF1006 · Accepted solution]

According to this publication link in IRS.gov, you meet the physical presence test if you are physically present in a foreign country or countries 330 full days during any period of 12 consecutive months including some part of the year at issue. The 330 qualifying days do not have to be consecutive. If the only time you spent in the states is what you have stated, you meet the physical presence test for the Foreign Earned Income Exclusion for the year.

In your case, August 8-13 are full days as illustrated in the IRS link. As far as days spent on business, the IRS isn't specific on this but I would count the days you were actually conducting business, which would be August 9-13.

@Garbanzor29

[Garbanzor29]

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@DaveF1006 wrote:

...In your case, August 8-13 are full days as illustrated in the IRS link. 

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That's the way I was reading it ...  since the first and last day weren't "full" from 0:00 to 0:00, I have to toss them out, and I can only count 6 "full days."  

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As far as days spent on business, the IRS isn't specific on this....

Exactly!   Consistently applying their same 'midnight to midnight equals a full day' rule, the business portion of August 9 - 13 would only come to 3 full days, whereas by ordinary reckoning, I would think of it as 5 days. 

I'll write down "5 days," which is what you seem to be suggesting.

I'm doing my own taxes online this year and wouldn't have thought much about it, but I was looking back over prior-year tax returns done by a CPA, and I noticed his way of counting didn't seem to match the way of counting shown in the IRS example.  Even a tax pro can be confused by IRS wording.

If the IRS had a reputation for being more forgiving, I wouldn't think much about such little things.

Thank you.

[Garbanzor29]

Thanks, Ernie.