Publication 54 - Tax Guide For U.s. Citizens And Resident Aliens Abord - 2011 Page 12
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44Tax Home
you can exclude or deduct certain foreign hous-
ing amounts. See Foreign Earned Income Ex-
4.
Your tax home is the general area of your main
clusion and Foreign Housing Exclusion and
place of business, employment, or post of duty,
Deduction, later.
regardless of where you maintain your family
You also may be entitled to exclude from
home. Your tax home is the place where you are
income the value of meals and lodging provided
Foreign Earned
to you by your employer. See Exclusion of Meals
permanently or indefinitely engaged to work as
and Lodging, later.
an employee or self-employed individual. Hav-
Income and
ing a “tax home” in a given location does not
necessarily mean that the given location is your
residence or domicile for tax purposes.
Requirements
Housing:
If you do not have a regular or main place of
business because of the nature of your work,
To claim the foreign earned income exclusion,
Exclusion –
your tax home may be the place where you
the foreign housing exclusion, or the foreign
regularly live. If you have neither a regular or
housing deduction, you must meet all three of
main place of business nor a place where you
Deduction
the following requirements.
regularly live, you are considered an itinerant
1. Your tax home must be in a foreign coun-
and your tax home is wherever you work.
try.
You are not considered to have a tax home in
Topics
a foreign country for any period in which your
2. You must have foreign earned income.
This chapter discusses:
abode is in the United States. However, your
3. You must be one of the following.
abode is not necessarily in the United States
•
Who qualifies for the foreign earned in-
while you are temporarily in the United States.
a. A U.S. citizen who is a bona fide resi-
come exclusion, the foreign housing exclu-
Your abode is also not necessarily in the United
dent of a foreign country or countries for
sion, and the foreign housing deduction,
an uninterrupted period that includes an
States merely because you maintain a dwelling
•
entire tax year.
in the United States, whether or not your spouse
The requirements that must be met to
or dependents use the dwelling.
claim either exclusion or the deduction,
b. A U.S. resident alien who is a citizen or
“Abode” has been variously defined as one’s
•
national of a country with which the
How to figure the foreign earned income
United States has an income tax treaty
home, habitation, residence, domicile, or place
exclusion, and
in effect and who is a bona fide resident
of dwelling. It does not mean your principal place
•
How to figure the foreign housing exclu-
of a foreign country or countries for an
of business. “Abode” has a domestic rather than
sion and the foreign housing deduction.
uninterrupted period that includes an
a vocational meaning and does not mean the
entire tax year.
same as “tax home.” The location of your abode
Useful Items
often will depend on where you maintain your
c. A U.S. citizen or a U.S. resident alien
You may want to see:
economic, family, and personal ties.
who is physically present in a foreign
country or countries for at least 330 full
Example 1. You are employed on an off-
Publication
days during any period of 12 consecu-
shore oil rig in the territorial waters of a foreign
tive months.
519
U.S. Tax Guide for Aliens
country and work a 28-day on/28-day off sched-
See Publication 519 to find out if you are a
ule. You return to your family residence in the
570
Tax Guide for Individuals With
U.S. resident alien for tax purposes and whether
Income from U.S. Possessions
United States during your off periods. You are
you keep that alien status when you temporarily
considered to have an abode in the United
596
Earned Income Credit (EIC)
work abroad.
States and do not satisfy the tax home test in the
If you are a nonresident alien married to a
foreign country. You cannot claim either of the
Form (and Instructions)
U.S. citizen or resident alien, and both you and
exclusions or the housing deduction.
your spouse choose to treat you as a resident
1040X Amended U.S. Individual Income
alien, you are a resident alien for tax purposes.
Example 2. For several years, you were a
Tax Return
For information on making the choice, see the
marketing executive with a producer of machine
2555 Foreign Earned Income
discussion in chapter 1 under
Nonresident Alien
tools in Toledo, Ohio. In November of last year,
Spouse Treated as a
Resident.
2555-EZ Foreign Earned Income
your employer transferred you to London, Eng-
Exclusion
land, for a minimum of 18 months to set up a
Waiver of minimum time requirements. The
sales operation for Europe. Before you left, you
minimum time requirements for bona fide resi-
See chapter 7 for information about getting
distributed business cards showing your busi-
dence and physical presence can be waived if
these publications and forms.
ness and home addresses in London. You kept
you must leave a foreign country because of
ownership of your home in Toledo but rented it
war, civil unrest, or similar adverse conditions in
to another family. You placed your car in stor-
that country. This is fully explained under
Waiver
Who Qualifies for the
of Time
Requirements, later.
age. In November of last year, you moved your
See Figure 4-A and information in this chap-
spouse, children, furniture, and family pets to a
Exclusions
ter to determine if you are eligible to claim either
home your employer rented for you in London.
exclusion or the deduction.
Shortly after moving, you leased a car and
and the Deduction?
you and your spouse got British driving licenses.
Tax Home in
Your entire family got library cards for the local
Foreign Country
If you meet certain requirements, you may qual-
public library. You and your spouse opened
ify for the foreign earned income and foreign
bank accounts with a London bank and secured
housing exclusions and the foreign housing de-
To qualify for the foreign earned income exclu-
consumer credit. You joined a local business
duction.
sion, the foreign housing exclusion, or the for-
league and both you and your spouse became
If you are a U.S. citizen or a resident alien of
eign housing deduction, your tax home must be
active in the neighborhood civic association and
the United States and you live abroad, you are
in a foreign country throughout your period of
worked with a local charity. Your abode is in
taxed on your worldwide income. However, you
bona fide residence or physical presence
London for the time you live there. You satisfy
may qualify to exclude from income up to
abroad. Bona fide residence and physical pres-
the tax home test in the foreign country.
$92,900 of your foreign earnings. In addition,
ence are explained later.
Chapter 4 Foreign Earned Income and Housing: Exclusion – Deduction
Page 12
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