Instructions For Form 2555 (Page 2 of 4) in pdf

because of the waiver of time

in a foreign country. See Pub. 54 for more

Specific Instructions

requirements, attach a statement to your

information and examples.

return explaining that you expected to

Note. A nonresident alien who, with a

meet the applicable time requirement, but

U.S. citizen or U.S. resident alien spouse,

Part II

the conditions in the foreign country

chooses to be taxed as a resident of the

prevented you from the normal conduct of

United States can qualify under this test if

Bona Fide Residence Test

business. Also, enter “Claiming Waiver” in

the time requirements are met. See Pub.

To meet this test, you must be one of the

the top margin on page 1 of your 2004

54 for details on how to make this choice.

following:

Form 2555.

•

A U.S. citizen who is a bona fide

Part IV

When To File

resident of a foreign country, or countries,

Enter in this part the total foreign earned

for an uninterrupted period that includes

A 2004 calendar year Form 1040 is

income you earned and received

an entire tax year (January 1 – December

generally due April 15, 2005.

(including income constructively received)

31, if you file a calendar year return), or

•

However, you are automatically

during the tax year. If you are a cash

A U.S. resident alien who is a citizen or

granted a 2-month extension of time to

basis taxpayer, report on Form 1040 all

national of a country with which the

file (to June 15, 2005, for a 2004 calendar

income you received during the tax year

United States has an income tax treaty in

year return) if, on the due date of your

regardless of when you earned it.

effect and who is a bona fide resident of a

return, you live outside the United States

foreign country, or countries, for an

Income is earned in the tax year you

and Puerto Rico and your tax home

uninterrupted period that includes an

perform the services for which you

(defined on page 1) is outside the United

entire tax year (January 1 – December 31,

receive the pay. But if you are a cash

States and Puerto Rico. If you take this

if you file a calendar year return). See

basis taxpayer and, because of your

extension, you must attach a statement to

Pub. 901, U.S. Tax Treaties, for a list of

employer’s payroll periods, you received

your return explaining that you meet

countries with which the United States

your last salary payment for 2003 in 2004,

these two conditions.

has an income tax treaty in effect.

that income may be treated as earned in

The automatic 2-month extension also

2004. If you cannot treat that salary

No specific rule determines if you are a

applies to paying the tax. However,

payment as income earned in 2004, the

bona fide resident of a foreign country

interest is charged on the unpaid tax from

rules explained under Income earned in

because the determination involves your

the regular due date (April 15, 2005, for a

prior year on page 3 apply. See Pub. 54

intention about the length and nature of

2004 calendar year return) until it is paid.

for more details.

your stay. Evidence of your intention may

Special extension of time. The first year

be your words and acts. If these conflict,

Foreign earned income for this

you plan to take the foreign earned

your acts carry more weight than your

purpose means wages, salaries,

income exclusion and/or the housing

words. Generally, if you go to a foreign

professional fees, and other

exclusion or deduction, you may not

country for a definite, temporary purpose

compensation received for personal

expect to qualify until after the automatic

and return to the United States after you

services you performed in a foreign

2-month extension period described

accomplish it, you are not a bona fide

country during the period for which you

earlier. If this occurs, you can apply for an

resident of the foreign country. If

meet the tax home test and either the

extension to a date after you expect to

accomplishing the purpose requires an

bona fide residence test or the physical

qualify.

extended, indefinite stay, and you make

presence test. It also includes noncash

To apply for this extension, complete

your home in the foreign country, you

income (such as a home or car) and

may be a bona fide resident. See Pub. 54

and file Form 2350, Application for

allowances or reimbursements.

Extension of Time To File U.S. Income

for more information and examples.

Foreign earned income does not

Tax Return, with the Internal Revenue

Lines 13a and 13b. If you submitted a

include amounts that are actually a

Service Center, Philadelphia, PA 19255,

statement of nonresidence to the

distribution of corporate earnings or

before the due date of your return.

authorities of a foreign country in which

profits rather than a reasonable allowance

Interest is charged on the tax not paid by

you earned income and the authorities

as compensation for your personal

the regular due date as explained earlier.

hold that you are not subject to their

services. It also does not include the

income tax laws by reason of

following types of income.

Choosing the Exclusion(s)

•

nonresidency in the foreign country, you

Pension and annuity income (including

To choose either of the exclusions,

are not considered a bona fide resident of

social security and railroad retirement

complete the appropriate parts of Form

that country.

benefits treated as social security).

•

2555 and file it with your Form 1040 or

Interest, ordinary dividends, capital

If you submitted such a statement and

Form 1040X, Amended U.S. Individual

gains, alimony, etc.

the authorities have not made an adverse

•

Income Tax Return. Your initial choice to

Portion of 2003 moving expense

determination of your nonresident status,

claim the exclusion must usually be made

deduction allocable to 2004 that is

you are not considered a bona fide

on a timely filed return (including

included in your 2004 gross income. For

resident of that country.

extensions) or on a return amending a

details, see Moving Expense Attributable

timely filed return. However, there are

to Foreign Earnings in 2 Years under

Part III

exceptions. See Pub. 54 for details.

Moving Expenses in Pub. 54.

•

Amounts paid to you by the U.S.

Once you choose to claim an

Physical Presence Test

Government or any of its agencies if you

exclusion, that choice remains in effect for

To meet this test, you must be a U.S.

were an employee of the U.S.

that year and all future years unless it is

citizen or resident alien who is physically

Government or any of its agencies.

revoked. To revoke your choice, you must

•

present in a foreign country, or countries,

Amounts received after the end of the

attach a statement to your return for the

for at least 330 full days during any period

tax year following the tax year in which

first year you do not wish to claim the

of 12 months in a row. A full day means

you performed the services.

exclusion(s). If you revoke your choice,

•

the 24-hour period that starts at midnight.

Amounts you must include in gross

you cannot claim the exclusion(s) for your

income because of your employer’s

next 5 tax years without the approval of

To figure the minimum of 330 full days’

contributions to a nonexempt employees’

the Internal Revenue Service. See Pub.

presence, add all separate periods you

trust or to a nonqualified annuity contract.

54 for more information.

were present in a foreign country during

Earned income credit. You cannot take

the 12-month period shown on line 16.

Income received in prior year. Foreign

the earned income credit if you claim

The 330 full days can be interrupted by

earned income received in 2003 for

either of the exclusions or the housing

periods when you are traveling over

services you performed in 2004 can be

deduction.

international waters or are otherwise not

excluded from your 2003 gross income if,

-2-

Instructions For Form 2555 Page 2

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