Eligible for foreign income exemption?

[BOS_LHR 829]

The basics:

-Married June 2013, filed MFS for that tax year

-UK citizen husband immigrated July 2, 2014

-Husband filed for a refund on taxes paid on UK income earned between April 1-July 1 2014, but nothing has been paid out as of yet

Now I'm filing MFJ for 2014. Since he's claiming a partial tax refund for his foreign income in 2014, do we not qualify to exclude his income from taxation on our US return?

If we can claim the exemption via bona fide residence, how do I handle Part II question 15 of the 2555? These questions make it sound like he's a US citizen with a work visa or similar allowing him to be employed abroad, which is of course not the case. TurboTax also asks for his employer information after going through the foreign income exclusion, I'm assuming that's in reference to his foreign employer rather than the US one he started with after immigrating?

[Nich-Nick 3,354]

Yes you qualify. Nothing to do with your UK taxes.

You are correct this form and TurboTax are geared more to Americans working abroad with their questions. They want to make sure the American really lived abroad legitimately and isn't trying to get some kind of a tax break for a long holiday. The American could possibly get allowances for housing he was required to keep while he maintained his home in the US. Mostly ignore those housings questions.whatever it takes for TurboTax to move on. Either put nothing or say anything to your house...rent, own, anything...because you aren't going to get those deductions.

No to family living with you abroad (UK). No to maintaining home in US. No to contract. No to visa (you didn't require a visa to work abroad in the UK.)

Employer is foreign employer who paid the money you want to exclude.

Edit: I answered that as if I was speaking to the immigrant. That is Otter, right? But you get what I mean.

Edited February 15, 2015 by Nich-Nick

[BOS_LHR 829]

Thanks Nich-Nick! Exactly right, the immigrant in this case is Hotter Otter. He's sitting next to me and just laughed saying you replied to my post, I laughed too because I was already typing my reply

I had filled everything out under the assumption he qualified, and entered something like "N/A - UK citizen" where it asked which visa allowed him to work abroad, but we needed a sanity check. Technically if his UK refund goes through there'll be 3 months of income that neither country taxes, doesn't seem like the kind of thing governments like to let happen. Very happy to have your reassurance we're on track. Your expertise is appreciated as always!

[Nich-Nick 3,354]

I'm kinda vague on what you are saying about a tax refund. If he had too much money held out of his paychecks for taxes, then they owe it to him. A "refund" isn't income.

Are you reporting his gross income, not after taxes income?