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Question for the Money Doctors

Question submitted on Apr 15, 2012.

Question

I worked in Kuwait from 4/2010-8/2011. I did not have to pay into taxes for the 2010 year, but I am wondering about the 2011 year. I was never out of kuwait for more than 30 days. in fact I only had one vacation during that time lasting 30 days.

Answer

I am not a foreign tax expert.  However, I am fortunate enough to office next to one.  The general rule is as follows:

To meet the physical presence test for the exclusion of foreign earned income, one has to spend 330 full days out of the US in any 12 month period.  If the 12 month period straddles the calendar year, the maximum exclusion amount must be prorated for the portion of the 12 month period in 2011.


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