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Megan C
Megan C, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 16579
Experience:  Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level
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I have tax questions. First let me say that I have been employed

Customer Question

I have tax questions. First let me say that I have been employed as an overseas contractor since April first 2012. I have spent a total of thirty days in the us since April first 2012. My main question is on partial foreign earned income exclusion, say that I end overseas contracting in DEC. 2012. Im unclear on how to prorate and calculate the exclusions. Second part of the question is the "tax year" common sense would tell me that id go from April 1 2012-March 31 2013 roughly, but what about the first few months in 2012? I didnt earn a bunch just simply some national guard weekend drill pays, but still how can i make the tax year as i stated before? Im lost on this, and would appreciate a tax expert to untangle this mess. Thankyou
Submitted: 4 years ago.
Category: Tax
Expert:  Megan C replied 4 years ago.
Thanks for asking your question! I'm sorry to hear about your tax issue and I'm going to try my best to help you understand or resolve it.

Thank you for your question. Your tax year is January 1 - December 31.

Your foreign earned income exclusion is the actual earnings that you earned overseas. You will not exclude any earnings, such as your drill earnings, that were not earned while overseas.

The maximum exclusion is $92,900. Since you were in the United States from January 1 to March 31, you would need to reduce the maximum from $92,900 to about 61,933. That is the maximum you can exclude. If you earned less than that, then you can exclude the full amount.

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Expert:  Megan C replied 4 years ago.
A follow up on your question - further research has lead me to the answer to your question. You do not have a foreign earned income exclusion. You will owe tax on all the earnings that you had while an overseas contractor.