Looking for a Form 2555 Templates? Download it for free!

The table beginning on page 5 lists the

qualifying period that fall within your 2009

moving expenses), credit, or exclusion

housing expense limits based on

tax year is 140 (August 14 through

that is definitely related to the excluded

geographic differences in foreign housing

December 31, 2009).

income. If only part of your foreign earned

costs relative to housing costs in the

income is excluded, you must prorate

Nontaxable U.S. Government

United States. If the location in which you

such items based on the ratio that your

allowances. If you or your spouse

incurred housing expenses is listed in the

excludable earned income bears to your

received a nontaxable housing allowance

table, or the number of days in your

total foreign earned income. See Pub. 54

as a military or civilian employee of the

qualifying period that fall within the 2009

for details on how to figure the amount

U.S. Government, see Pub. 54 for

tax year is less than 365, use the Limit on

allocable to the excluded income.

information on how that allowance may

Housing Expenses Worksheet on page 3

affect your housing exclusion or

The exclusion under section 119 and

to figure the amount to enter on line 29b.

deduction.

the housing deduction are not considered

If the location in which you incurred

Line 34. Enter any amount your

definitely related to the excluded income.

housing expenses is not listed in the

employer paid or incurred on your behalf

table, and the number of days in your

Line 44. Report in full on Form 1040 and

that is foreign earned income included in

qualifying period is 365, enter $27,420 on

related forms and schedules all

your gross income for the tax year

line 29b.

deductions allowed in figuring your

(without regard to section 911).

Example. For 2009, because your

adjusted gross income (Form 1040, line

Examples of employer-provided

location is not listed in the table beginning

37). Enter on line 44 the total amount of

amounts are:

on page 5, your limit on housing

those deductions (such as the deduction

•

Wages and salaries received from your

expenses is $75.12 per day ($27,420

for moving expenses, the deduction for

employer.

divided by 365). If you file a calendar year

one-half of self-employment tax, and the

•

The fair market value of compensation

return and your qualifying period is

expenses claimed on Schedule C or C-EZ

provided in kind (such as the fair rental

January 1, 2009, to October 1, 2009 (274

(Form 1040)) that are not allowed

value of lodging provided by your

days), you would enter $20,583 on line

because they are allocable to the

employer as long as it is not excluded on

29b ($75.12 multiplied by 274 days).

excluded income. This applies only to

line 25).

deductions definitely related to the

More than one foreign location. If

•

Rent paid by your employer directly to

excluded earned income. See Pub. 54 for

you moved during the 2009 tax year and

your landlord.

details on how to report your itemized

incurred housing expenses in more than

•

Amounts paid by your employer to

deductions (such as unreimbursed

one foreign location as a result, complete

reimburse you for housing expenses,

employee business expenses) that are

the Limit on Housing Expenses

educational expenses of your

allocable to the excluded income.

Worksheet on page 3 for each location in

dependents, or as part of a tax

which you incurred housing expenses,

equalization plan.

entering the number of qualifying days

Part IX

Self-employed individuals. If all of your

during which you lived in the applicable

foreign earned income (Part IV) is

If line 33 is more than line 36 and line 27

location on line 1. Add the results shown

self-employment income, skip lines 34

is more than line 43, complete this part to

on line 4 of each worksheet, and enter the

and 35 and enter -0- on line 36. If you

figure your housing deduction.

total on line 29b.

qualify for the housing deduction, be sure

Line 49. Use the housing deduction

If you moved during the 2009 tax

to complete Part IX.

carryover worksheet on this page to figure

year and are completing more

your carryover from 2008.

than one Limit on Housing

Part VII

CAUTION

Expenses Worksheet, the total number of

One-year carryover. If the amount on

Married couples. If both you and your

days entered on line 1 of your worksheets

line 46 is more than the amount on line

spouse qualify for, and choose to claim,

may not exceed the total number of days

47, you can carry the difference over to

the foreign earned income exclusion,

in your qualifying period that fall within the

your 2010 tax year. If you cannot deduct

figure the amount of the exclusion

2009 tax year (that is, the number of days

the excess in 2010 because of the 2010

separately for each of you. You each

entered on Form 2555, line 31).

limit, you cannot carry it over to any future

must complete Part VII of your separate

Line 31. Enter the number of days in

tax year.

Forms 2555.

your qualifying period that fall within your

Community income. The amount of the

2009 tax year. Your qualifying period is

Paperwork Reduction Act Notice. We

exclusion is not affected by the

the period during which you meet the tax

ask for the information on this form to

income-splitting provisions of community

home test and either the bona fide

carry out the Internal Revenue laws of the

property laws. The sum of the amounts

residence or the physical presence test.

United States. You are required to give us

figured separately for each of you is the

Example. You establish a tax home

the information. We need it to ensure that

total amount excluded on a joint return.

and bona fide residence in a foreign

you are complying with these laws and to

country on August 14, 2009. You maintain

allow us to figure and collect the right

Part VIII

the tax home and residence until January

amount of tax.

31, 2011. You are a calendar year

If you claim either of the exclusions, you

taxpayer. The number of days in your

cannot claim any deduction (including

You are not required to provide the

information requested on a form that is

subject to the Paperwork Reduction Act

unless the form displays a valid OMB

Housing Deduction Carryover

control number. Books or records relating

to a form or its instructions must be

Worksheet — Line 49

Keep for Your Records

retained as long as their contents may

become material in the administration of

any Internal Revenue law. Generally, tax

1. Enter the amount from your 2008 Form 2555, line 46 . . . . . . . . . .

returns and return information are

confidential, as required by Internal

2. Enter the amount from your 2008 Form 2555, line 48 . . . . . . . . . .

Revenue Code section 6103.

3. Subtract line 2 from line 1. If the result is zero, stop; enter -0- on

The average time and expenses

line 49 of your 2009 Form 2555. You do not have any housing

required to complete and file this form will

deduction carryover from 2008 . . . . . . . . . . . . . . . . . . . . . . . . . .

vary depending on individual

circumstances. For the estimated

4. Enter the amount from your 2009 Form 2555, line 47 . . . . . . . . . .

averages, see the instructions for your

income tax return.

5. Enter the amount from your 2009 Form 2555, line 48 . . . . . . . . . .

If you have suggestions for making this

6. Subtract line 5 from line 4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

form simpler, we would be happy to hear

from you. See the instructions for your

7. Enter the smaller of line 3 or line 6 here and on line 49 of your 2009

income tax return.

Form 2555. If line 3 is more than line 6, you cannot carry the

difference over to any future tax year . . . . . . . . . . . . . . . . . . . . .

-4-

Instructions for Form 2555 (2009)

Instructions For Form 2555 - Foreign Earned Income - Internal Revenue Service - 2009 Page 4

Related Articles

Related forms

Related Categories