# Foreign Earned Income Tax Worksheet



## USExpat777 (Jan 12, 2017)

Hi all,

I've just come across the Foreign Earned Income Tax Worksheet. Is this new? I don't recall seeing it before, and I can't make much heads or tails on how to fill it out. Can someone please explain? Are they trying to tax foreign earned income now via this worksheet??


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## Bevdeforges (Nov 16, 2007)

Are you talking about the Foreign Earned Income Exclusion? That would be form 2555, which is more than a "worksheet." By "earned income" they are referring to salary or salary-like earnings (say, from a personal business). But there are limits on how much you can "exclude" via form 2555.


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## USExpat777 (Jan 12, 2017)

Hi Bev, have a look at line 45 on form 2555. They now ask that we fill out a Foreign Earned Income Tax worksheet to enter a figure in for line 16 of the 1040. I'm a bit alarmed and confused. Can anyone clarify?


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## Moulard (Feb 3, 2017)

The worksheet is used to calculate the tax rate for income that has not been excluded. It ensures that you stay in the same tax bracket. Its been in place since 2006.

Prior to the change, say you had 100,000 in excludable income and $100 of non-excludable income the $100 would be taxed as if you only had $100 in income

Now, that $100 is taxed at the rate at your top marginal rate... ie. as if all $100,100 of income was taxable but it is only applied to that $100

If you use the FEIE you cannot use the standard tax tables, you have to use the worksheet to correctly calculate tax on non-excluded income


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## USExpat777 (Jan 12, 2017)

Moulard said:


> The worksheet is used to calculate the tax rate for income that has not been excluded. It ensures that you stay in the same tax bracket. Its been in place since 2006.
> 
> Prior to the change, say you had 100,000 in excludable income and $100 of non-excludable income the $100 would be taxed as if you only had $100 in income
> 
> ...


Ah, that is interesting, Moulard, I didn't know that, thank you for explaining. However, line 45 is different from last year, so are you saying this is a new feature of the FEIE? Should one still fill it out if all income was excluded?


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## cowface (Feb 25, 2021)

Hello All, 

I am an expat using form 2555 for the first time. Luckily, all of my income is exempt. My question is:

How do I include the exempt income on the 1040?

-Do I list it on Line 1 as Wages and also include it in parenthesis on Line 8 (negative amount)? This would give a total of -0- for Line 15. 

Note: I work for a foreign company, and I was not provided a W-2. This is why I am wondering if I include the income on Line 1.

Thanks in advance for any help with this question.


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## USExpat777 (Jan 12, 2017)

cowface said:


> Hello All,
> 
> I am an expat using form 2555 for the first time. Luckily, all of my income is exempt. My question is:
> 
> ...


Hi, yes, that sounds right. And also in brackets on line 8, Schedule 1.


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## cowface (Feb 25, 2021)

USExpat777 said:


> Hi, yes, that sounds right. And also in brackets on line 8, Schedule 1.


Thank you for the input, 777!


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