Publication 54 - Tax Guide For U.s. Citizens And Resident Aliens Abord - 2011 Page 30
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44Exemptions
Items Related to
5.
Excluded Income
You can claim an exemption for your nonresi-
dent alien spouse on your separate return, pro-
vided your spouse has no gross income for U.S.
U.S. citizens and resident aliens living outside
Exemptions,
tax purposes and is not the dependent of an-
the United States generally are allowed the
other U.S. taxpayer.
same deductions as citizens and residents living
You also can claim exemptions for individu-
Deductions, and
in the United States.
als who qualify as your dependents. To be your
dependent, the individual must be a U.S. citizen,
If you choose to exclude foreign earned in-
U.S. national, U.S. resident alien, or a resident
Credits
come or housing amounts, you cannot deduct,
of Canada or Mexico for some part of the calen-
exclude, or claim a credit for any item that can
dar year in which your tax year begins.
be allocated to or charged against the excluded
amounts. This includes any expenses, losses,
Children. Children usually are citizens or re-
Topics
and other normally deductible items that are
sidents of the same country as their parents. If
allocable to the excluded income. You can de-
you were a U.S. citizen when your child was
This chapter discusses:
duct only those expenses connected with earn-
born, your child generally is a U.S. citizen. This
•
ing includible income.
is true even if the child’s other parent is a non-
The rules concerning items related to ex-
resident alien, the child was born in a foreign
cluded income,
These rules apply only to items definitely
country, and the child lives abroad with the other
•
Exemptions,
related to the excluded earned income and they
parent.
do not apply to other items that are not definitely
•
If you have a legally adopted child who is not
Contributions to foreign charitable organi-
related to any particular type of gross income.
a U.S. citizen, U.S. resident, or U.S. national, the
zations,
These rules do not apply to items such as:
child meets the citizen requirement if you are a
•
Moving expenses,
U.S. citizen or U.S. national and the child lived
•
Personal exemptions,
•
Contributions to individual retirement ar-
with you as a member of your household all
•
Qualified retirement contributions,
rangements (IRAs),
year.
•
•
Alimony payments,
Taxes of foreign countries and U.S. pos-
Social security number. You must include on
sessions, and
•
Charitable contributions,
your return the social security number (SSN) of
•
each dependent for whom you claim an exemp-
How to report deductions.
•
Medical expenses,
tion. To get a social security number for a de-
•
Mortgage interest, or
pendent, apply at a Social Security office or U.S.
Useful Items
consulate. You must provide original or certified
•
Real estate taxes on your personal resi-
You may want to see:
copies of documents to verify the dependent’s
dence.
age, identity, and citizenship, and complete
Publication
Form SS-5.
For purposes of these rules, your housing
If you do not have an SSN for a child who
deduction is not treated as allocable to your
501
Exemptions, Standard Deduction,
was born in 2011 and died in 2011, attach a
excluded income, but the deduction for self-
and Filing Information
copy of the child’s birth certificate to your tax
employment tax is.
return. Print “Died” in column (2) of line 6c of
514
Foreign Tax Credit for Individuals
your Form 1040 or Form 1040A.
If you receive foreign earned income in a tax
521
Moving Expenses
If your dependent is a nonresident alien who
year after the year in which you earned it, you
is not eligible to get a social security number,
523
Selling Your Home
may have to file an amended return for the
you must list the dependent’s individual tax-
earlier year to properly adjust the amounts of
590
Individual Retirement Arrangements
payer identification number (ITIN) instead of an
deductions, credits, or exclusions allocable to
(IRAs)
SSN. To apply for an ITIN, file Form W-7 with the
your foreign earned income and housing exclu-
IRS. It usually takes 6 to 10 weeks to get an
597
Information on the United States —
sions.
ITIN. Enter your dependent’s ITIN wherever an
Canada Income Tax Treaty
SSN is requested on your tax return.
Example. In 2010, you had $86,000 of for-
Form (and Instructions)
eign earned income and $9,500 of deductions
More information. For more information
1116 Foreign Tax Credit
allocable to your foreign earned income. You did
about exemptions, see Publication 501.
not have a housing exclusion. Because you ex-
2106 Employee Business Expenses
cluded all of your foreign earned income, you
2555 Foreign Earned Income
would not have been able to claim any of the
Contributions to
deductions on your 2010 return.
2555-EZ Foreign Earned Income
Foreign Charitable
Exclusion
In 2011, you received a $12,000 bonus for
work you did abroad in 2010. You can exclude
3903 Moving Expenses
Organizations
$5,500 of the bonus because the limit on the
Schedule A (Form 1040) Itemized
foreign earned income exclusion for 2010 was
Deductions
If you make contributions directly to a foreign
$91,500 and you have already excluded
Schedule C (Form 1040) Profit or Loss
church or other foreign charitable organization,
$86,000. Since you must include $6,500 of the
you generally cannot deduct them. Exceptions
From Business
bonus ($12,000 − $5,500) for work you did in
are explained under Canadian, Mexican, and
SS-5 Application for a Social Security
2010 in income, you can file an amended return
Israeli charities, later.
Card
for 2010 to claim $630 of the deductions. This is
You can deduct contributions to a U.S. or-
the deductions allocable to the foreign earned
W-7 Application for IRS Individual
ganization that transfers funds to a charitable
income ($9,500) multiplied by the includible por-
foreign organization if the U.S. organization con-
Taxpayer Identification Number
tion of the foreign earned income ($6,500) and
trols the use of the funds by the foreign organi-
divided by the total foreign earned income for
See chapter 7 for information about getting
zation or if the foreign organization is just an
these publications and forms.
2010 ($98,000).
administrative arm of the U.S. organization.
Chapter 5 Exemptions, Deductions, and Credits
Page 30
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