United States foreign earned income exclusion for 2026
United States foreign earned income exclusion rules combine an annual exclusion amount with foreign tax-home and residence or presence conditions.
- Foreign earned income exclusion, 2026
- $132,900IRS, Revenue Procedure 2025-32
- Physical presence test
- At least 330 full days during 12 consecutive monthsIRS, foreign earned income exclusion
Annual exclusion amount
For tax years beginning in 2026, the foreign earned income exclusion amount is $132,900. IRS, Revenue Procedure 2025-32 (opens in a new tab).
Tax home and qualifying tests
Claiming the exclusion requires foreign earned income and a tax home in a foreign country. A United States citizen can qualify through bona fide residence for an uninterrupted period including an entire tax year. A United States resident alien can use this residence test if a citizen or national of a country with an income tax treaty in effect with the United States. A citizen or resident alien can instead qualify through physical presence abroad for at least 330 full days during 12 consecutive months. IRS, foreign earned income exclusion (opens in a new tab).
Self-employment income
A qualifying individual may claim the exclusion on foreign earned self-employment income. The excluded amount reduces regular income tax but does not reduce self-employment tax. IRS, foreign earned income exclusion (opens in a new tab).
Scope
This guide covers the annual exclusion amount and basic qualifying conditions. It excludes individual eligibility, partial-year calculations, housing relief, treaty analysis and filing advice. General information only, not personalised tax advice.