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Purpose of Form. If you qualify, you can use Form 2555 to figure your foreign earned income exclusion and your housing exclusion or deduction. You cannot exclude or deduct more than the amount of your foreign earned income for the year.
General Information. If you are a U.S. citizen or a resident alien living in a foreign country, you are subject to the same U.S. income tax laws that apply to U.S. citizens and resident aliens living in the United States. Note. Specific rules apply to determine if you are a resident or nonresident alien of the United States. See Pub. 519.
Department of the Treasury Internal Revenue Service. Foreign Earned Income. Attach to Form 1040 or 1040-SR. Go to www.irs.gov/Form2555 for instructions and the latest information.
Purpose of Form 2555: This form is used to claim the foreign earned income exclusion, potentially excluding foreign earnings from U.S. tax. Considerations and Drawbacks: Claiming the foreign earned income exclusion can affect eligibility for other tax benefits and comes with certain restrictions.
Form 2555 is the form you file to claim the Foreign Earned Income Exclusion, which allows you to exclude up to $120,000 of foreign earned income for the 2023/2024 tax year. The Foreign Earned Income Exclusion exists the help prevent double-taxation.
Form 2555 instructions. Form 2555 Part I requires expats to enter their name, address, employer’s details (if applicable), and details of their Tax Home. Part II is for expats claiming using the Bona Fide Residence Test. Alternatively, expats claiming under the Physical Presence Test should fill in part III.
If you meet the requirements, you can complete Form 2555 to exclude your foreign wages or salary from income earned in the foreign country. You may also qualify to exclude compensation for certain foreign housing costs or your personal services.
IRS Form 2555 – The Foreign Earned Income Exclusion. Table of contents. 10min. read. The Foreign Earned Income Exclusion, or FEIE, is one of the tax breaks available for US expats to eliminate or reduce any US tax liability on income earned from living and working abroad.
Form 2555 is a tax form that can be filed by US citizens and Green Card Holders who have earned income from outside the United States and Puerto Rico. It is used to claim the foreign earned income exclusion and/or the foreign housing exclusion.
A U.S. resident alien who is a citizen or national of a country with which the United States has an income tax treaty in effect and who is a bona fide resident of a foreign country, or countries, for an uninterrupted period that includes an entire tax year (January 1–December 31, if you file a calendar year return). Physical Presence Test.