# Is Community Employment Scheme Income (Irish equivalent to Workfare) taxable?



## expat2684 (Feb 2, 2019)

The scheme is administered by the Department of Social protection in Ireland in order to assist the long-term unemployed, ill etc. in a return to work. It is considered taxable income in Ireland, PRSI is paid by the “employer” for this work earned by the participant. I believe in the US, the equivalent is called ‘Workfare’. 

I did one year of this type of work which is slightly over the threshold at $12,000. I cannot seem to find a definitive answer online as to whether I even need to file this particular year - was this income taxable or non-taxable? .. this was my only source of income for that year. If it was taxable, can I exclude it with the FEIE? In my opinion, it is earned income rather than unearned, however, I have read conflicting information online regarding this. 

Thank you, 

From a confused Irish person.


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## Bevdeforges (Nov 16, 2007)

There is never anything "definite" about foreign sources of income - whether or not they are similar (or identical) to programs in the US.

As long as you did some sort of work in exchange for the income, I'd just declare it as "salary" and exclude it on the 2555 (FEIE) form if you're going to declare at all. The alternative is to just not bother if you're that close to the threshold for filing. There is no reporting of your income in Ireland to the IRS (no W-2 or 1099) and if that was your sole source of income for the year, it probably won't matter one way or the other.


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## expat2684 (Feb 2, 2019)

Bevdeforges said:


> There is never anything "definite" about foreign sources of income - whether or not they are similar (or identical) to programs in the US.
> 
> As long as you did some sort of work in exchange for the income, I'd just declare it as "salary" and exclude it on the 2555 (FEIE) form if you're going to declare at all. The alternative is to just not bother if you're that close to the threshold for filing. There is no reporting of your income in Ireland to the IRS (no W-2 or 1099) and if that was your sole source of income for the year, it probably won't matter one way or the other.


Thank you. There are so many conflicting sources for info online, even on the IRS website. It’s pretty difficult to know how to treat certain items in my situation as I was out of work for a very long time and receiving either Illness Benefit or payment for Community Employment. I didn’t return to full-time work until 2015 - those years will be straightforward to do. I am going to prepare the returns myself.


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## Nononymous (Jul 12, 2011)

The approach to take when reporting income about which the IRS has no information other than that which you give it - i.e. any and all income earned outside the US with the exception of interest on a FATCA-reported account - is to keep it simple, or don't report it all. Either say it was $12k in employment income and wipe it out with the FEIE, or don't bother filing for that year. Don't do anything that potentially costs you money.


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