Hi and welcome to Just Answer!
If you are a US Government
employee paid by a U.S. agency to perform services in a foreign
country, your pay is from the U.S. Government and does not qualify for the exclusions or the deduction
. This is true even if the U.S. agency is reimbursed by the foreign government.
The issue is that if you will file a joint tax return
- your income
would be taxed at higher marginal tax rate
as if your spouse's foreign earned income
would not be excluded.
In this case - it might be more beneficial to file separate tax returns
However - there are some disadvantages with separate tax returns. For instance - if one of you itemizes - the other must itemize. You may not claim some deductions
, etc based on your specific circumstances.
So while most likely filing
separate tax returns would be more beneficial - to be précised - you might want to prepare
your tax returns both ways and compare before finalizing your decision.
Let me know if you need any help.
Be sure to ask if any clarification needed.