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As a US citizen, if I work a US based tech job remotely from a foreign country as a permanent resident (Latvia if it matters), but all my money is paid into US accounts, is this money still considered "foreign earned income" with respect to the Foreign Earned Income Exclusion?

If so, and I am married to a non-US citizen do I still qualify for the joint exclusion of $200k?

If the individuals are married and both work abroad and meet either the bona fide residence test or the physical presence test, each one can choose the foreign earned income exclusion. Together, they can exclude as much as $201,600 for the 2015 tax year.

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  • Just to make sure this is clear: you are a US citizen, working for a US company, paid directly by that US company (into US accounts), as either an employee or a direct contractor, and you are sitting in a chair in Latvia. Married to a non-US citizen also physically sitting in a chair in Latvia. And both paying Latvian taxes?
    – Joe
    Jun 5, 2018 at 17:21
  • @Joe Exactly. And paying Latvian taxes as a permanent resident of Latvia.
    – user32205
    Jun 5, 2018 at 17:26
  • So your nonUS-citizen spouse is agreeing to be taxed on her world-wide income by filing a joint US return with you? Jun 5, 2018 at 19:50
  • @DilipSarwate You can answer assuming so. I'm checking interpretations of the law rather than making actual decisions.
    – user32205
    Jun 5, 2018 at 21:28

1 Answer 1

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The IRS has spoken (IRS Pub. 54 2017),

4) My wife and I are both employed, reside together, and file a joint return. We meet the qualifications for claiming the foreign earned income exclusion. Do we each figure a separate foreign earned income exclusion and foreign housing exclusion?

You figure your foreign earned income exclusion separately since you both have foreign earned income. The amount of the exclusion for each of you can’t exceed your separate foreign earned incomes.

You must figure your housing exclusion jointly. See Married Couples in chapter 4 for further details.

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