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Lane
Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 10469
Experience:  Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986
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I need to amend my friend taxes. She filed MFJ her husband

Customer Question

I need to amend my friend taxes. She filed MFJ her husband is USA citizen but she did not include his income. He has his business in Saudi + he is an employee in Saudy. I doubt they get W2 forms. What do I need to ask just the amount of income to be reported? Which forms do I file ?
Submitted: 3 months ago.
Category: Tax
Expert:  Lane replied 3 months ago.

Hi,

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Yes, your assumption is good. YOu simply need to know the amount of wages if he is an employee.

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If he is SELF-employed and receives payment as a contractor, you need a schedule C (and his business expenses)

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But if he is an amployee, you'll just add the wages to line 7

Customer: replied 3 months ago.
Any particular forms that I need to fill out since he lived abroad all year? There is exception on income earned abroad? Is he going to be subject to all the taxes in USA ?
Expert:  Lane replied 3 months ago.

The hurdle for FEIE (Foreign Earned Income Exclusion) are rather high, if he wasn't there ALL year.

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Foreign Earned Income Exclusion - Requirements

To claim the foreign earned income exclusion, the foreign housing exclusion, or the foreign housing deduction, you must have foreign earned income, your tax home must be in a foreign country, and you must be one of the following:

  • A U.S. citizen who is a bona fide resident of a foreign country or countries for an uninterrupted period that includes an entire tax year,
  • A U.S. resident alien who is a citizen or national of a country with which the United States has an income tax treaty in effect and who is a bona fide resident of a foreign country or countries for an uninterrupted period that includes an entire tax year, or
  • A U.S. citizen or a U.S. resident alien who is physically present in a foreign country or countries for at least 330 full days during any period of 12 consecutive months.

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https://www.irs.gov/uac/about-form-2555