Resources

It lets qualifying US citizens and resident aliens living abroad exclude foreign earned income from US taxable income, up to an annual limit. The IRS limit is $130,000 for 2025, $132,900 for 2026 and $137,300 for 2027.

Generally, yes, if your income meets the filing requirement. The FEIE is claimed on a filed return, using Form 2555, so living abroad doesn't remove the need to file.

You generally need to be physically present in a foreign country or countries for at least 330 full days during a 12-month period, and have a foreign tax home.

You generally need to be a bona fide resident of a foreign country for an uninterrupted period that includes a full tax year, and have a foreign tax home. It depends on your facts, such as your ties to the country and the purpose of your stay.

No. The FEIE can reduce income tax, but self-employment tax can still apply. A totalization agreement may affect this in some countries.

You can use both in the same year, but not on the same income. You can't take a credit for foreign tax on income you excluded.

Records made at the time. Keep receipts, mileage logs and a note of the business purpose, so you can show what you spent, when, and why.

Generally, yes. The IRS treats digital assets as property, so selling or trading them can create a capital gain or loss. The rate depends on how long you held the asset and on your income.