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My son and his family have lived in Mexico this past year,

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My son and his...

My son and his family have lived in Mexico this past year, and he received sabbatical salary from his US employer,Is that deductible under the foreign income exclusion provision?

Accountant's Assistant: The Accountant will know how to help. Please tell me more, so we can help you best.

My daughter in law has received payment from her US based magazine for articles written about her reprting from Mexico. Is that eligible for exclusion under theForeign Incoe exclusion provision?

Accountant's Assistant: Is there anything else important you think the Accountant should know?

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Submitted: 21 days ago.Category: Tax
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4/2/2018
Tax Professional: Chad EA, CFP ®, CERTIFIED FINANCIAL PLANNER TM, Professional replied 21 days ago
Chad EA, CFP ®
Chad EA, CFP ®, CERTIFIED FINANCIAL PLANNER TM, Professional
Category: Tax
Satisfied Customers: 2,164
Experience: Federally licensed IRS Enrolled Agent, Certified Financial Planner (R), MBA
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Hello!

My name is***** will assist you today.

Please give me one moment while I review your question and type my initial response

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Tax Professional: Chad EA, CFP ®, CERTIFIED FINANCIAL PLANNER TM, Professional replied 21 days ago

From what you have stated, the foreign income exclusion would not apply to your son or his wife. -- The income was not foreign earned and the tax home is still the US.

___

Please see the relevant excerpt from IRS.Gov below.

Foreign Earned Income Exclusion - Requirements

https://www.irs.gov/individuals/international-taxpayers/foreign-earned-income-exclusion-requirements

To claim the foreign earned income exclusion 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.

Please let me know if this has answered your question or if you have any additional questions.

When you have no further questions a positive rating of 5 stars is much appreciated.

Thank you!

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