Say I live and work in the United States, but mostly do contract work for European organizations. This would mean that I very often invoice and get paid in EUR, which initially might go into a EUR bank account (or a multi-currency account with a EUR "bucket"), before eventually being converted to USD and sent to my main American USD bank account.
When filing my US taxes on this income I need to know the specific annual value of this EUR income as USD, so what is the appropriate way to calculate the USD value?
Also, while I can look at the exchange rates and value of some of the money that was converted from EUR->USD during the year, what happens if some of that work income was not exchanged/converted to USD within the tax year? In other words, how can I calculate the appropriate USD value of EUR income that was never actually converted to USD during the tax year?
Any other recommendations? Is there anything I need to know about getting paid in foreign currency as an American? (I'm trying my best to do the math correctly, but I'm finding it very daunting and confusing dealing with foreign-currency income.)