U.S. citizen Patrick is a bona fide resident of a foreign country for all of the current year. Patrick uses a calendar year as his tax year. He has $100,000 of self- employment income and incurs $20,000 in housing expenses. The base housing cost amount is $16,624. The deduction for housing expenses is

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The deduction for housing expenses is calculated as the excess of actual housing expenses over the base housing amount. Patrick's housing expenses are $20,000, and the base amount is $16,624. The excess is $3,376 ($20,000 - $16,624), which is deductible for AGI.

US Citizen Patrick Is a Bona Fide Resident of a Foreign