@Industrialmaterial
I agree that doesn't sound right. It sounds like your wife might not be qualifying for the foreign earned income credit, either because she really doesn't qualify, or because you entered something incorrectly in TurboTax. See if Form 2555 is included in your tax return, and if the exclusion appears on Schedule 1 line 8d. If not, she is not getting the exclusion.
You can't just enter the foreign income. You have to go through the "Foreign Earned Income and Exclusion" topic under "Less Common Income." I would think that that section of TurboTax would have told you if your wife did not qualify for the exclusion. Your wife has to satisfy either the bona fide residence test or the physical presence test, and she has to have had a tax home in the foreign country. See the IRS Instructions for Form 2555 for details. You haven't said anything about your living arrangements in 2024, but if your wife qualifies for the exclusion and your W-2 income is not foreign income, you had to have been living apart for most or all of the year. To qualify for the exclusion she has to have worked in the foreign country. If she worked in the United States for a foreign employer or client, that is not foreign earned income. If she worked in a foreign country for the U.S. government she does not qualify for the exclusion.
