Is form 2555 mandatory?

Who needs to file Form 2555? You need to file IRS form 2555 if you want to claim the foreign earned income exclusion. You can claim an exclusion for income you earned abroad if you qualify under the bona fide residence test or the physical presence test and if you have a foreign tax home.

What is the housing deduction form 2555?

The computation of the base housing amount (line 32 of Form 2555) is tied to the maximum foreign earned income exclusion. The amount is 16% of the maximum exclusion amount divided by 365 (366 if a leap year), then multiplied by the number of days in your qualifying period that fall within your tax year.

What is the difference between form 2555 and 2555-EZ?

Form 2555-EZ is a simplified version of Form 2555 that was designed to make it easier for taxpayers to file. Starting with the 2019 tax year, Form 2555-EZ can no longer be used to claim the Foreign Earned Income Exclusion.

How do I report foreign earned income to the IRS?

Form 2555. You must attach Form 2555, Foreign Earned Income, to your Form 1040 or 1040X to claim the foreign earned income exclusion, the foreign housing exclusion or the foreign housing deduction. Do not submit Form 2555 by itself.

Who qualifies for foreign income exclusion?

A U.S. citizen or a U.S. resident alien who is physically present in a foreign country or countries for at least 330 full days during any period of 12 consecutive months.

What income qualifies for foreign income exclusion?

$112,000
The Foreign Earned Income Exclusion allows a taxpayer to exclude up to $108,700 (2021 figure; $112,000 in 2022) of foreign earned income from U.S. taxation.

What is the maximum foreign housing exclusion for 2020?

$41,158
You are a calendar year taxpayer. The number of days in your qualifying period that fall within your 2020 tax year is 140 (August 14 through December 31, 2020). Your maximum exclusion for 2020 is $41,158 (140/366*$107,600).

Can I exclude foreign rental income?

In most cases, you will need to report income from foreign rental properties you own on your US tax return. The exception to this would be if owning and renting properties is your only job.

Is there a 2555-EZ for 2020?

Taxpayers filing for 2020 may be eligible to exclude up to $107,600 of their earned foreign income by filing IRS Form 2555-EZ, although the self-employment taxes must still be paid. Let’s go over everything you need to know about filing the 2555-EZ.

Who qualifies for the Foreign Earned Income Exclusion?

Do you file FBAR every year?

The FBAR is an annual report, due April 15 following the calendar year reported. You’re allowed an automatic extension to October 15 if you fail to meet the FBAR annual due date of April 15. You don’t need to request an extension to file the FBAR.