Helen is a U.S.citizen and CPA who moved to London, England, three years ago to work for a British company.This year, she spent the entire year in London and earned a salary of $110,000.How much of her salary will she be allowed to exclude from gross income in the U.S.?

Question

Quizplus · Accepted Answer

Based on the tax treaty between the U.S. and U.K., a U.S. citizen who is a resident of the U.K. and earns income in the U.K. may exclude up to $105,900 from gross income on their U.S. tax return. Therefore, Helen will be able to exclude $105,900 from her salary of $110,000, leaving her with $4,100 that will be included in her U.S. gross income.

Helen Is a U