Tom, a calendar-year taxpayer, worked in Japan from July 1, 2018 through June 30, 2019.He earned $80,000 in 2018 and $90,000 in 2019 while in Japan.The maximum foreign earned income exclusion amount is $103,900 for 2018 and $105,900 for 2019.Which of the following statements is true?

Question

Quizplus · Accepted Answer

Tom's foreign earned income for 2018 is $80,000, which is less than the maximum exclusion amount of $103,900. Therefore, he can exclude all of his 2018 foreign earned income. For 2019, Tom's foreign earned income is $90,000, which is also less than the maximum exclusion amount of $105,900. Therefore, he can exclude all of his 2019 foreign earned income as well.

Tom, a Calendar-Year Taxpayer, Worked in Japan from July 1