I need help filing my taxes. I am a us citizen linving abroad. My income is 35,000.00

[jimmmora89]

I live in Panama. My 2016 income was around US$35,000.00. I need help filing the form.

[JohnR1]

U.S. citizens and residents are subject to U.S. federal taxation, irrespective of whether they are working in the U.S. or in a foreign country.  So your income earned in Panama will be subject both to U.S. federal and Panamanian taxation.

However, there are provisions in the U.S. tax code to mitigate double taxation of income earned by U.S. citizens and residents working abroad - you may be able to qualify for a foreign earned income exclusion under 1 of 2 tests, the Bona Fide Residence Test or the Physical Presence Test, as well as a foreign housing exclusion or deduction, for your Panamanian housing costs.  You can also take a foreign tax credit for the Panamanian taxes paid on your unexcluded income earned in Panama, to the extent it is double taxed both by Panama and the U.S.

TurboTax supports filing Form 2555, Foreign Earned Income,  to calculate your foreign earned income exclusion and foreign housing exclusion or deduction, as well as Form 1116, Foreign Tax Credit.

The Deluxe, Premier and Self-Employed versions of TurboTax Online all support Form 2555 and Form 1116 (not Federal Free), as well as all versions of TurboTax Desktop, for Windows or Mac.

Please see the following TurboTax FAQ, "What are Forms 2555 and 2555-EZ used for?", for instructions on how to enter information in TurboTax about your (or your spouse's) foreign earned income:

https://ttlc.intuit.com/replies/3301984

To see where to enter in TurboTax Online foreign income taxes which you paid or accrued in 2016, for purposes of claiming the Foreign Tax Credit on Form 1116, please see the following TurboTax FAQ, "Where do I enter the foreign tax credit (Form 1116) or deduction?":

https://ttlc.intuit.com/replies/3302405

[churchman 7]

Yes

[churchman 7]

Yes i am a u.s. citizen

[LinaJ2020]

Without a tax document like a Form W-2, in TurboTax program, you would enter your foreign income as follows:

In TurboTax online,

• After sign into your account, select Pick up where you left off
• At the right upper corner, in the search box, type in foreign income and Enter 
• Select Jump to foreign income 
• Follow prompts

After you enter the information, if you qualify for a foreign earned income exclusion, the program will prompt you to fill out a Form 2555 Foreign Earned Income Exclusion.  To qualify, you have to live outside the United States for at least 330 days during 12 consecutive months.  For more information, please see Foreign income and exclusion and Extension. 

If you have paid taxes to both foreign country and the US tax authorities, the IRS allows you to claim a foreign tax credit on your US tax return.  To claim this foreign tax credit, you would need to file a Form 1116 Foreign Tax Credit. 

Here are the steps: 

• At the right upper corner, in the search box, type in "foreign tax credit" and Enter
• Select Jump to foreign tax credit
• Follow prompts

For example, if you made $35,000 overseas, you can use the exclusion Form 2555 to exclude it.  Or you can use foreign tax credit on the whole amount, whichever benefits you the most.  However, you cannot use both benefits ( double-dip) on the same amount.  

As of today, this form will not be available until February 2/18/2021.  To check forms availability, click here: IRS forms

You would use Form 2555 to calculate the excludable portion of your foreign income that you made and the housing exclusion deduction while working on foreign soil.  For 2020, the maximum exclusion amount has increased to $107,600.  Due to the global health emergency caused by COVID-19, the IRS has provided relief related to the time requirement necessary to meet either the bona fide residence test or physical presence test.  To  learn more, click here: https://www.irs.gov/instructions/i2555

@jimmmora89