Form 2555, Foreign Earned Income, is prepared from information entered on this worksheet. Calculated amounts from various forms carry to Form 2555. Detail entries carry to Form 1040.
Use two Forms 2555 if the taxpayer and spouse each qualify with income earned abroad. Complete separate Foreign Earned Income Exclusion worksheets for each person claiming the foreign earned income exclusion.
Income from the earned income forms carry to Form 2555 based on the presence of the foreign country code on those forms. Entries from those forms do not need to be entered on this worksheet.
Override the amounts carried from other expatriate worksheets with entries on override worksheets.
Form 2555 exclusions and/or deductions are reflected on Form 1116.
If Form 2555 isn't prepared, verify the source of foreign income is earned, and the source of earned income has a foreign country code entered. Also, optimization may have determined that using Form 2555 was not beneficial because tax was already zero. Form 2555 may be forced on Expatriate Information worksheet, Optimization Selection section, Optimization Code field.
The expatriate worksheets are:
| Worksheet | Title |
|---|---|
| Expatriate Information | Optimization Selection, Allocation of Compensation, Extension, Prior Year Unused Section 911, Storage Fees, Foreign Moving Expense Recapture, Other Income, Adjustments and Noncash Income, Foreign Miscellanious Income |
| Foreign Mortgage Gain | Foreign Mortgage Gain Information |
| Two-Year Comparison | Foreign |
| Foreign Assets | Report of Foreign Bank and Financial Accounts |
| Foreign Earned Income Excl | General, Bona Fide Residence Test, Physical Presence Test, Value of Meals and Lodging Included in Income, Allocations Deductions Adjustment, Qualified Housing Expenses, Prior Year Housing Deduction Carryover, Wages - Override, Allowable Share of Income for Personal Services Performed This Year O/R, Allowance and Reimbursements - Overrides, Noncash and Other Foreign Earned Income - Override, Miscellaneous Information - Overrides, Calculation Options, Print Options, Miscellaneous Preparation Options and E-File Information |
| Foreign Tax Credit | Processing Options, General, Part I - Foreign Income and Deduction Adjustments, Part I - Adjustments, Part II - Foreign Taxes Paid or Accrued, Prior Year Taxes Paid in the Current Year, Part III - Carryovers - Computation of Foreign Tax Credit, Part III - Carryovers - Computation of Foreign Tax Credit - AMT, if different, Other, Reduction Ratio Adjustments, Boycott Operations, Recharacterization of Prior Year Losses |
| Credit for Prior Year Alternative Minimum Tax (Form 8801) | Credit for Prior Year Alternative Min Tax (Form 8801, Form 1116) |
| Expatriate Wages | Wages, Allowances and Reimbursements, Income Partially Earned in Prior Years, State Allocation Results, |
| Other State Information, New Jersey, New York ,Ohio, Pennsylvania, Ohio Cities, Michigan Cities, Form 4852 Information | |
| Travel Abroad | Travel Abroad |
The following forms may also be used to identify foreign source data:
| Worksheet | Title |
|---|---|
| Moving Expenses | Foreign Moving Expenses |
| Business | Foreign |
| Installment Sales | Other Options |
| Gains and Losses | Stocks, Securities, and Other Non-Passive Transactions, Other Capital Transactions, Capital Loss Carryovers |
| Sale of Your Home | |
| Like-Kind Exchanges | General |
| Rent and Royalty | Foreign |
| Schedule F / Form 4835 | Foreign |
| Form 8992 - US Shareholder Calculation fo GILTI | Schedule A - Net Tested Income and GILTI Allocated |
| Fiduciary Passthrough | Activity |
| Partnership Passthrough | Activity |
| Large Partnership Passthrough | Foreign |
| S Corporation Passthrough | Activity |
| Tax on Lump-Sum Distributions | Qualifications |
| IRAs, Pensions and Annuities | Foreign |
| Other Income | 1099-MISC - Other, 1099-NEC - Other, 1099-G - Other, |
| Social Security Income | SA-1099 - Other |
Foreign source business and professional expenses and farming expenses are allocated to foreign earned income when the Business worksheet or Schedule F is submitted with a foreign country code. To identify numerator and denominator adjustments to the allocation ratio for business and professional expenses and farming expenses included in "Deductions allowed in figuring your AGI that are allocable to excluded income" on Form 2555, Part VIII, use the Allocations Deductions Adjustment section. The ratio used is foreign earned income and housing exclusions over total foreign earned income.
Also use this form to enter qualified housing expenses, as well as housing deduction carryover.
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