Question

helen is a U.S citizen and a cpa who moved to London., England three years ago to work for a company. this year she spent the entire year in London and earned a salary of $132,000. how much of her salary will she be allowed to exclude from income in the United States?

Answer 1

Answer:

107600 for 2020 ( 105900 for 2019)

A US  citizen or resident alien who live in a foreign country can exclude foreign income upto an amount adjusted anually for inflation.It is 107600 for 2020.

• The conditions to be qualified to claim exclusions
• The US citizen must be a bona fied resident of a foreign country for an entire year.
•   A US resident alien who is a citizen or a national of a foreign country with which US has income tax treaty
• The US citizen or resident alien who is physicaly present in a foreign country for atleast 330 days in 12 consecutive months.