Foreign Housing Exclusion
If you are living abroad and are receiving income from your employer for housing, you may be eligible for the Foreign Housing Exclusion. Employers may offer housing funds directly to you or may include them as part of your overall income. Both options are acceptable qualifies for the exclusion for the deduction. Those who are self-employed can also receive the deduction. The costs of renting an apartment and repairs, utilities, and insurance are deductible. Extra expenses such as furniture, television, or home improvements are not eligible. The IRS calculates your Foreign Housing amount as the “expenses for the year minus the base housing amount.” Housing limits are enforced based on where you reside. Use form 2555 to calculate your amount. (https://www.irs.gov/forms-pubs/about-form-2555). Give us a call with any questions or concerns on this deduction in particular or any general tax information.
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