Publication 54 - Tax Guide For U.s. Citizens And Resident Aliens Abroad - 2006 Page 39
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44Questions and Answers
find I will not qualify for the ex-
12) I am a U.S. citizen who
This section answers tax-
The first installment of esti-
clusion, how and when should I
worked in the United States for 6
related questions commonly asked
mated tax is due on April 15 of the
file my return?
months last year. I accepted em-
by taxpayers living abroad.
year for which the income is
ployment overseas in July of last
earned.
year and expect to qualify for the
If your regular filing date has
Filing Requirements —
foreign earned income exclu-
passed, you should file a return,
Where, When, and How
8) Will a check payable in foreign
sion. Should I file a return and
Form 1040, as soon as possible for
currency be acceptable in pay-
pay tax on the income earned in
last year. Include a statement with
ment of my U.S. tax?
1) When are U.S. income tax re-
the United States during the first
this return noting that you have re-
turns due?
6 months and then, when I qual-
turned to the United States and will
Generally, only U.S. currency is ac-
ify, file another return covering
not qualify for the foreign earned
Generally, for calendar year tax-
ceptable for payment of income
the last 6 months of the year?
income exclusion. You must report
payers, U.S. income tax returns are
tax. However, if you are a Fulbright
your worldwide income on the re-
due on April 15. If you are a U.S.
grantee, see Fulbright Grant in
No. You have the choice of one of
turn. If you paid a foreign tax on the
citizen or resident and both your tax
chapter 1.
the following two methods of filing
income earned abroad, you may be
home and your abode are outside
your return:
the United States and Puerto Rico
able to either deduct this tax as an
9) I have met the test for physical
a) You can file your return when
on the regular due date, an auto-
itemized deduction or claim it as a
presence in a foreign country
due under the regular filing rules,
matic extension is granted to June
credit against your U.S. income
and am filing returns for 2 years.
report all your income without ex-
15 for filing the return. Interest will
tax.
Must I file a separate Form 2555
cluding your foreign earned in-
be charged on any tax due, as
(or Form 2555-EZ) with each re-
However, if you pay the tax due
come, and pay the tax due. After
shown on the return, from April 15.
turn?
after the regular due date, interest
you have qualified for the exclu-
will be charged from the regular
sion, you can file an amended re-
2) I am going abroad this year
Yes. A Form 2555 (or Form
due date until the date the tax is
turn, Form 1040X, accompanied by
and expect to qualify for the for-
2555-EZ) must be filed with each
paid.
Form 2555 (or 2555-EZ), for a re-
eign earned income exclusion.
Form 1040 tax return on which the
How can I secure an extension of
fund of any excess tax paid.
5) I am a U.S. citizen and have no
benefits of income earned abroad
time to file my return, when
b) You can postpone the filing of
taxable income from the United
are claimed.
should I file my return, and what
your tax return by applying on Form
States, but I have substantial in-
forms are required?
2350 for an extension of time to file
come from a foreign source. Am
10) Does a Form 2555 (or
I required to file a U.S. income
to a date 30 days beyond the date
2555-EZ) with a Schedule C or
a) You should file Form 2350 by
tax return?
you expect to qualify under either
Form W-2 attached constitute a
the due date of your return to re-
the bona fide residence test or the
return?
quest an extension of time to file.
Yes. All U.S. citizens and resident
physical presence test, then file
Form 2350 is a special form for
aliens are subject to U.S. tax on
your return reflecting the exclusion
No. The Form 2555 (or 2555-EZ),
those U.S. citizens or residents
their worldwide income. If you paid
of foreign earned income. This al-
Schedule C, and Form W-2 are
abroad who expect to qualify under
taxes to a foreign government on
lows you to file only once and
merely attachments and do not re-
either the bona fide residence test
income from sources outside the
saves you from paying the tax and
lieve you of the requirement to file a
or physical presence test and
United States, you may be able to
waiting for a refund. However, in-
Form 1040 to show the sources of
would like to have an extension of
claim a foreign tax credit against
terest is charged on any tax due on
income reported and the exclu-
time to delay filing until after they
your U.S. income tax liability for the
the postponed tax return, but inter-
sions or deductions claimed.
have qualified.
foreign taxes paid. Form 1116 is
est is not paid on refunds paid
b) If the extension is granted,
used to figure the allowable credit.
within 45 days after the return is
11) On Form 2350, Application
you should file your return after you
filed. (If you have moving expenses
for Extension of Time To File
qualify, but by the approved exten-
6) I am a U.S. citizen who has
that are for services performed in
U.S. Income Tax Return, I stated
sion date.
retired, and I expect to remain in
two years, you can be granted an
that I would qualify under the
c) You must file your Form 1040
a foreign country. Do I have any
physical presence test. If I qual-
extension to 90 days beyond the
with Form 2555 (or Form 2555-EZ).
further U.S. tax obligations?
ify under the bona fide residence
close of the year following the year
test, can I file my return on that
of first arrival in the foreign coun-
3) My entire income qualifies for
Your U.S. tax obligation on your
basis?
try.)
the foreign earned income exclu-
income is the same as that of a
sion. Must I file a tax return?
retired person living in the United
Yes. You can claim the foreign
13) I am a U.S. citizen. I have
States. (See the discussion on fil-
lived abroad for a number of
earned income exclusion and the
Generally. Every U.S. citizen or
ing requirements in chapter 1 of
years and recently realized that I
foreign housing exclusion or de-
resident must file a U.S. income tax
this publication.)
should have been filing U.S. in-
duction under either test as long as
return unless total income without
come tax returns. How do I cor-
you meet the requirements. You
regard to the foreign earned in-
7) I have been a bona fide resi-
rect this oversight in not having
are not bound by the test indicated
come exclusion is below an
dent of a foreign country for over
filed returns for these years?
in the application for extension of
amount based on filing status. The
5 years. Is it necessary for me to
time. You must be sure, however,
income levels for filing purposes
pay estimated tax?
File the late returns as soon as pos-
that you file the Form 1040 by the
are discussed under Filing Re-
sible, stating your reason for filing
date approved on Form 2350,
quirements in chapter 1.
U.S. taxpayers overseas have the
late. For advice on filing the re-
since a return filed after that date
same requirements for paying esti-
turns, you should contact either the
4) I was sent abroad by my com-
may be subject to a failure to file
mated tax as those in the United
Internal Revenue Service repre-
pany in November of last year. I
penalty.
States. See the discussion under
sentative serving your area or the
plan to secure an extension of
Estimated Tax in chapter 1.
If you will not qualify under the
Internal Revenue official who trav-
time on Form 2350 to file my tax
bona fide residence test until a date
Overseas taxpayers should not
els through your area (details can
return for last year because I ex-
include in their estimated income
later than the extension granted
be obtained from your nearest U.S.
pect to qualify for the foreign
any income they receive that is, or
under the physical presence rule,
consulate or Embassy). You can
earned income exclusion under
will be, exempt from U.S. taxation.
apply for a new extension to a date
also write to the Internal Revenue
the physical presence test. How-
30 days beyond the date you ex-
Overseas taxpayers can deduct
Service, International Section, P.O.
ever, if my company recalls me
their estimated housing deduction
pect to qualify as a bona fide resi-
B o x
9 2 0 ,
B e n s a l e m ,
P A
to the United States before the
end of the qualifying period and I
in figuring their estimated tax.
dent.
19020-8518.
Publication 54 (2006)
Page 39
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