Foreign earned income exclusion for my spouse - please help!

[abby1234]

Thank you very much for the information. My main problem is that I don't know which line to add her foreign wage in 1040 form.  Line 1 on form 1040 (Wages, salaries, tips, etc.) seems to associate with W2, which she doesn't have. Schedule 1 also has no section for foreign wage. So I don't know how to include her wage in  taxable income.

If I understand correctly, foreign tax credit (form: 1116) and Foreign income exclusion (form: 2555) are more like the tax deduction stage and don't aggregate into income (line:15 in form 1040)

Please help. I have spent days to find answer specifically for this but I can't find people having the same issue. IRS website also doesn't indicate where to report foreign wage in 1040.

[superduper]

I'm not a tax expert. The wages are generally converted to USD equivalent. 

My tax person, who did a foreign earned income exclusion (not a foreign tax credit) since that was more benefitial. I'm looking at my 1040 schedule 1, he added her foreign income in 8z in USD, and he added the exclusion also in 8d. 

[abby1234]

superduper

 That's what I need! Thank you very much. This helps a lot and I do really appreciate

[SundayInSalem]

@abby1234 TurboTax is no longer a member of the IRS Free File Alliance. I suggest contacting customer support for the programme you are using or hiring a tax professional. 

Using a 'free programme' to prepare a complex tax return will not save you money if the IRS audits you and levies interest, penalties and back taxes. There are plenty of accountants who specialise in ex-pat taxation, which is a complex and difficult area.

[Critter-3]

If you did not receive a W-2 for your wages, there is no need to complete the W-2 section.  Report your foreign earned income on Form 2555.

If you started a W-2, then delete the W-2.

Enter w-2 in the Search box located in the upper right of the program screen.  Click on Jump to w-2

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/Find box located in the upper right of the program screen.  Click on Jump to foreign income

[KTN121]

Hi,

I am trying to file married filing jointly with my spouse who lives in Europe. We are attaching the W-7/ITIN application and I am filing for an extension given we are still applying for the ITIN. When I use turbotax, there is no area to put his income as he does not have a W-2 in Europe. Where do we put our spouse's income even if it is on the lower side?

Also in the state of Massachusetts, I am finding inconclusive messaging about not being able to file jointly if my spouse does not live with me for the same time period in 2024 but areas saying I can file jointly if i filed jointly on my Federal taxes? Does anyone have more clarity? If I file separate for my state, I have to do a whole new turbotax  (I know there is a thread somewhere on this). I was hoping to file jointly for both Federal and Mass.

I greatly appreciate any help!

Kelly

[DaveF1006]

If you are treating your non-resident spouse as a US resident for tax purposes, Massachusetts conforms with federal law and allows you to file Married Filing Jointly.

To file his income, go to:

1. Income
2. Less Common Income
3. Foreign income and exclusion

[oburt]

@SusanY1 Thank you for your explanation. I'm trying to reconcile your explanation with information I found in IRS "Instructions for Form 2555" (IRS Link). Under the section "Physical Presence Test", it states

"Note. A nonresident alien who, with a U.S. citizen or U.S. resident alien spouse, chooses to be taxed as a resident of the United States can qualify under this test if the time requirements are met. See Pub. 54 for details on how to make this choice."
This seems to suggest that a nonresident alien spouse who makes the election to be treated as a U.S. resident may qualify FEIE if the Physical Presence Test requirement are met. Is my understanding correct or am I missing something?

[SusanY1]

Yes, this it is currently permitted for NRA spouse meeting the criteria to take the exclusion.  Please disregard the 2022 comments made about this issue. 

The current instructions tell us this is clearly allowed.