TurboTax asking for 2555-T for foreign Earned Income Credit.

[Gallatin]

Husband works as a civilian with the Dept of Defense in Germany.  We are unable to file because we are stuck in a loophole of satisfying the Total Foreign Earned Income despite not earning foreign income.  We re-entered the W-2 and Turbo Tax still sees the income as Foreign earned credit.  Unclear where to go from here.

[DaveF1006]

First of all, go to ax tools>tools>delete a form>delete any 2555 or 1116 forms including all the worksheets.  If you are using the software, go to the forms mode, select the forms and delete the forms by pressing the delete form button at the bottom. After all the forms are deleted, see if the error message clears. if not, then you need to start from the beginning by following these precise steps. 

1. First delete your W2 entry so we can start from scratch.  After the entry is deleted, then
2. Click on Federal 
3. Click on Wages and Income  
4. Scroll down to Less Common Income
5. On Foreign Earned Income and Exclusion, click on the start or update button.
6. First question asks if you made money out of the US, say yes.
7. Next screen select W2.
8. Next screen asks was your foreign income reported on a W2, here you will say yes and this will take you to the W2 entry screen.
9. Record your W2 information here.
10. After the information is recorded, there will be a screen that says, Let's Check for uncommon Situations.  Here you will check Worked outside of USA
11. Then select done for now.
12. This will bring you back to the foreign income screen where you started initially. Press continue.
13. Then when you get to a screen asking if this income came from a government source, say yes.
14. Then scroll through the next couple of screens until you reach a screen asking whose income are you trying to exclude, indicate that you are not trying to exclude income. In this case, check the box that neither of you is trying to exclude income if this is an option. Otherwise if only your husband's name appears here, indicate that you are not trying to exclude his income. This should end the section.
15. Now this will generate a form 2555 and 1116 because Turbo Tax likes to be helpful but confusing at the same time.  Now you will need to delete the forms in accordance with the instructions given in the opening paragraph. This should now alleviate the issue.

Hopefully, this will clear up when you delete the forms initially and you won't need to go through the 15 steps that I outlined. Let me know if this helps.