Foreign Earned Income Exclusion Eligibility

You may have heard of the Foreign Earned Income Exclusion. Perhaps you are wondering what it is all about and if you can benefit from it in some way. After all, none of us want to pay more taxes than necessary. And unfortunately, few tax preparers fully understand this concept. That means if you are unlucky enough to file your taxes with the aid of a misinformed CPA or one that has little or no experience in this area, you may end up paying more than you should to the government. That’s why it’s important that you utilize the services of a tax planner that specializes in Expatriate Income Tax rules. The Certified Public Accountants at Tax Planner CPA are trained and experienced on Foreign Earned Income laws and regulations.

What this means for you as a client of this prestigious firm is expert attention to every detail of your tax preparation and assurance that you will enjoy all the exclusion benefits you are eligible for. So what are the factors that will need to be looked at in determining your eligibility? First of all you need to know that whether you live in the US or in a foreign country, the rules for filing income taxes are generally the same. Important factors that determine whether you must file an income tax return include such things as your gross income, filing status, and age. Your gross income will include any income that may be excluded under the foreign earned income exclusion rules. You should also be aware that in general, all the same rules regarding due dates, extensions and estimated taxes will also apply (Although your April 15 deadline is automatically extended to June 15).

Dollar amounts reported on US tax returns will be expressed in US dollars. In most cases Social Security and Medicare taxes will not apply to income earned in foreign countries, unless you are self employed.

Much of the confusion about Foreign Earned Income Exclusion and expatriate income tax is related to the ‘tax home’. A tax home is the location of your place of employment or business. This is not necessarily the same as your actual home or place of residence. Furthermore, the location of your tax home often depends on whether you will be working at that location temporarily or indefinitely.

If you qualify for the Foreign Earned Income Exclusion a great amount of your income can usually be excluded (Up to $91,400 in 2009). Clearly there are some extreme advantages to working with a professional CPA experienced in expatriate income tax preparation. At Tax Planner CPA you will get that and more.

If you are curious about your eligibility for the foreign earned income exclusion, you may try the online eligibility test found here: http://www.taxplannercpa.com/foreign-earned-income-exclusion-eligibility.php

About The Author:
Connie Saxton has a home in the Philippines. She moved there to work on a television documentary series. When tax time rolled around Saxton was confused about the Expatriate Income Tax laws and how they affected her. A friend told her about Tax Planner CPA, the leading experts in expat income rules and regulations. Saxton was pleased to find out that under the Foreign Earned Income Exclusion she qualified for substantial tax savings.