Catherine Posted February 22 Report Posted February 22 Taxpayer received a small amount of income from former employer from when t/p was resident in a foreign country. Money was earned there, while t/p qualified for foreign earned income exclusion. However, the funds were not paid out until over a year later (there was a class-action back-pay suit of some kind). How does this get reported? It should qualify for FEIE because it was earned while t/p fully qualified for that (and in that year was well under the limitations of excludable income). But the payout was well over a year after returning to the US. I can't figure out how to report this correctly and get the exclusion not to throw error messages (Drake, so not asking about those). Or do we just give up and be glad it was eventually paid out? It's less than $1,000 in total. Quote
Lee B Posted February 22 Report Posted February 22 "Caution! You cannot exclude income you receive after the end of the year following the year in which you did the work to earn it." https://www.irs.gov/individuals/international-taxpayers/figuring-the-foreign-earned-income-exclusion 1 1 Quote
Catherine Posted February 22 Author Report Posted February 22 Okay, thank you @Lee B. Maybe Form 1116 foreign tax credit, assuming the client paid tax in the source country. Quote
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