United States Foreign Housing Exclusion (FHE)

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What is Foreign Housing Exclusion ?

The Foreign Housing Exclusion allows US taxpayers living abroad to deduct or exclude the cost of rental housing abroad from their gross income on their US tax return.

Who is Eligible for Foreign Housing Exclusion ?

The foreign housing exclusion and deduction is an allowance for taxpayers who live and work in a foreign country.

Who Qualifies for Foreign Housing Exclusion ?

You must qualify under a physical presence test or bona fide residency test. In addition, to use the FHE, your housing costs must exceed 16% of the FEIE amount for a given tax year.

What are the Qualified Housing Expenses under FHE ?

Rent and utilities are qualified expenses, such as home repairs, parking, real and personal property insurance and ancillary rent.

How Much is the Foreign Housing Exclusion ?

For tax year 2022, the maximum housing exclusion amount is $15,680.

How to Calculate Foreign Housing Exclusion ?

The FHE amount is equal to your total foreign housing expenditure (up to 30% of FEIE) for the year, minus the base housing amount (which is equal to 16% of FEIE).

How to Claim the Foreign Housing Exclusion ?


You would claim your FHE on Form 2555, the same form you would use to file for FEIE.