Part IV: Report your annual foreign earned income.Part II or III: Complete the required information depending on whether you’re qualifying under the bona fide residence test or the physical presence test.Part I: Provide general Information about your employer and previous foreign income exclusion claims.There are nine sections you will need to complete when filling out Form 2555, including: Among other information, taxpayers using this form need to submit information about where they are currently living, overseas employment, and may need to determine whether they qualify for this consideration. To claim your foreign earned as well as any related deductions or exclusions, you can complete tax form 2555. Government or any of its agencies does not qualify. Income you have earned from working abroad as an employee of the U.S. Some of your foreign housing costs (cannot be considered lavish or extravagant).Does not include unearned income such as dividends, interest, or capital gains.Earned income (wages, salary, tips, bonuses, etc.).These general guidelines will help you determine which income you’ve earned, if any, qualifies for the foreign income exclusion: What Income Qualifies for Foreign Income Exclusion? However, for certain income to be tax free, it must be deemed eligible. With the Foreign Earned Income Exclusion, you may qualify to exclude up to $105,900 of your income.
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citizen or resident alien who is physically present in one or more foreign countries for at least 330 full days during any period of 12 months in a row. Physical presence test : You are a U.S.has an income tax treaty and are a bona fide resident of one or more foreign countries for an uninterrupted period that includes an entire tax year. resident alien who is a citizen or national of a country with which the U.S. citizen who is a bona fide resident of one or more foreign countries for an uninterrupted period that includes an entire tax year. Meet either the bona fide residence test or the physical presence test:.For this qualification, your tax home must be outside the U.S. Meet the tax home test: Your tax home is the location where you indefinitely work.However, there are a few requirements to qualify for foreign income exclusion benefits. citizen living and working abroad, you may need to file Form 2555. The main purpose of tax form 2555 is to help taxpayers determine their exclusions relating to foreign earned income and housing in order to properly file federal income taxes. IRS Form 2555 is intended for the reporting of foreign earned income to the Internal Revenue Service (IRS).
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This guide to IRS Form 2555 Foreign Earned Income can help you understand your tax obligations and how to go about filing your income taxes. However, it can also complicate your filing when tax season comes around. Living and working abroad can be an exciting opportunity to experience a different lifestyle, see the world, and possibly even save on your taxes.
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