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You are earning the income in Dubai?
You are considered a resident if you meet the test for a lawful permanent resident. This is known as the green card test.
If you meet the green card test at anytime during the calendar year, but do not meet the substantial presence test for that year, your residency starting date is the first day on which you are present in the United States as a Lawful Permanent Resident.
You started your US residency in September and then started working in Dubai?
Since you do not meet the substantial presence test you residency would start in September. So the income you earned from September to December would be taxable in the US.
The foreign earned income exclusion is $101,300. To qualify for this you would need to meet the substantial presence test. This means that you would need to reside in Dubai for 330 days during a 12 month period.
Yes, you would report the income that you receive from the time you received the Green Card to the end of the year. If you qualify for the foreign earned income exclusion you would be exclude this income. If you give up your Green Card in April you would recognize the income from January to the time you give up your Green Card. You would be able to exclude the income if you qualify for the foreign earned income exclusion. One way to qualify is to meet the physical presence test. To do this you would need to have lived in the foreign country for 330 days in a 12 month period.
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, you must meet either the Bona Fide Residence or Physical Presence Test, and you must make a valid election.
This would be claimed on form 2555.
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In your prior post you mentioned that your total income was $176,000. I am assuming that this is one an annual basis. This would make your monthly income roughly $15,000. So if you have a green card since September your US income would be approximately $60,000. If you meet the 330 day requirement you would be able to exclude the entire amount of the foreign earned income for 2016. If in 2017 you give up your green card in April, the same type of situation would apply. Again you would have about four months of income or approximately $60,000. If you again qualify for the earned income exclusion you would be able to exclude just over $101,000 of foreign earned income. So again you would not have any tax liability.
The amount of the exclusion would be prorated based on the number of days you worked in the foreign country. So the so the $101,000 would need to be multiplied by the percentage of the time you were in the foreign country . So if you obtained your green card September 1st you would have 1/3 of the year for the prorated exclusion. So your exclusion would be a little more than $33,000. So your taxable income would be $60,000 less the $33,000 or $27,000. You would reduce your taxable income by the standard deduction of approximately $12,000 and the personal exemption amounts of approximately $4,000 per individual or $16,000 (assuming that you had two children). This would decrease your taxable income to zero. If you give up your green card in April the calculation would be very similar.
Please give me a moment I am verifying the qualifications of a green card holder claiming a child as a dependent.
To qualify for a dependent exemption your children would need to be U.S. Citizens or resident aliens. If you are working abroad you would not meet this qualification. To file married filing jointly you would need to include your wife's income on your return.
You would be looking at a small amount of taxable income. The income would be taxed at the 10% tax bracket. So at a taxable income of $7,000 your tax would be $700.
I need to step away from my computer for a few minutes. I will look through the file and let you know.
Yes, you have a little bit of a unique situation. The tax software that I use was not able to handle this situation. I am still researching this for you. I apologize for the delay. I will work on this today.