The FEIE is a tax benefit that allows you to exclude a certain amount of foreign earned income from U.S. taxation, one of the ways that the Internal Revenue Service allows expats to double taxation on their foreign-sourced income.
If you are a US resident alien and you live abroad or are a US citizen, you are taxed on your worldwide income. To claim FEIE benefits, your tax home must be in a foreign country and you must have foreign earned income.
Every year, the amount of Foreign Earned Income Exclusion is adjusted for inflation. For 2022, the foreign earned income exclusion limit is $112,000.
All income must be earned in a foreign country to count as foreign earned income. Foreign earned income includes wages, bonuses, commissions, salaries and self-employment income.
If you are forced to leave abroad due to adverse circumstances such as war or civil unrest, the minimum time requirements for both the physical presence test and the actual residence may be waived.