2022 Foreign Earned Income Exclusion
The 2022 Foreign Earned Income Exclusion is $112,000.
Effective 2022-01-01Source: Rev. Proc. 2021-45 (IRS)Verified 2026-08-29
Compared with 2021
| Item | 2021 | 2022 | Change |
|---|---|---|---|
| Exclusion amount | $108,700 | $112,000 | +$3,300 (+3.0%) |
Who it applies to
U.S. citizens and resident aliens living and working abroad who qualify under the bona fide residence test or the physical presence test.
What changed this year, and why
For taxable years beginning in 2022, the foreign earned income exclusion under IRC § 911(b)(2)(D)(i) is $112,000, as set by IRS Revenue Procedure 2021-45.
Common questions
- Who can claim the foreign earned income exclusion?
- A qualifying U.S. citizen or resident alien whose tax home is in a foreign country and who meets either the bona fide residence test or the physical presence test may exclude up to $112,000 of foreign earned income from gross income for the 2022 tax year.
- Is the exclusion automatic?
- The exclusion is elective and is claimed by filing Form 2555 with the taxpayer's federal income tax return.
Your tax home has to be in a foreign country
If your main job or post of duty is in the United States, you do not qualify for the foreign earned income exclusion or the foreign housing exclusion or deduction. Your tax home is the general area where you work, not where you keep your house. You must keep your tax home outside the United States for the whole time you are trying to count on as a bona fide resident or as physically present abroad.
To qualify for the foreign earned income exclu- sion, the foreign housing exclusion, or the for- eign housing deduction, your tax home must be in a foreign country throughout your period of bona fide residence or physical presence abroad.
Publication 54 (2022), Tax Guide for U.S. Citizens and Resident Aliens Abroad (IRS)
The bona fide residence test
The bona fide residence test is one of two ways a U.S. citizen or resident alien can qualify for the foreign earned income exclusion and the foreign housing exclusion or deduction. You meet this test only if you are a bona fide resident of a foreign country, or of more than one foreign country, for an uninterrupted period that includes an entire tax year. For most taxpayers the tax year is the calendar year, so your period of residence must cover all of January 1 through December 31 of the year for which you are claiming the exclusion. You do not automatically become a bona fide resident simply by living abroad; the determination depends on the nature and length of your stay and your intention to make that country your home for the year. If you are a U.S. resident alien, you can use the test only if you are a citizen or national of a country that has an income tax treaty in effect with the United States. Once you meet the test, up to $112,000 of foreign earned income for 2022 may be excluded.
You meet the bona fide residence test if you are a bona fide resident of a foreign country or countries for an uninterrupted period that in- cludes an entire tax year.
Publication 54 (2022), Tax Guide for U.S. Citizens and Resident Aliens Abroad (IRS)
330 full days in any 12 months
The physical presence test is the other way a U.S. citizen or resident alien can qualify for the foreign earned income exclusion and the foreign housing exclusion or deduction. You meet it by being physically present in a foreign country, or in more than one foreign country, for at least 330 full days during any 12-consecutive-month period. The 330 days do not have to be consecutive, and they do not all have to fall within the tax year for which you are claiming the exclusion. A full day means a complete day of twenty-four hours. Any reason for being abroad counts - work, vacation, or family - so long as you are physically in a foreign country. The test looks only at how long you stay, not at the kind of residence you establish or your intentions about returning. If you meet the test, you can exclude up to $112,000 of foreign earned income for 2022, prorated if the qualifying period covers only part of the year.
You meet the physical presence test if you are physically present in a foreign country or coun- tries for 330 full days during a period of 12 con- secutive months.
Publication 54 (2022), Tax Guide for U.S. Citizens and Resident Aliens Abroad (IRS)
The separate foreign housing exclusion
In addition to the foreign earned income exclusion, qualifying taxpayers may claim a separate foreign housing exclusion. The housing exclusion lets employees treat a limited amount of income used for housing expenses as not taxable by the United States. It is separate from the earned income exclusion and has its own dollar cap, which is tied to the exclusion amount and to the number of qualifying days in the tax year. For 2022, the base housing amount used to figure the limit is 16% of $112,000 on a daily basis, which works out to $49.10 per day, or $17,920 for the full year. Qualified housing expenses above that base amount, up to a location-specific maximum, can be excluded by employees; self-employed individuals take a corresponding housing deduction instead. The housing benefit is claimed on Form 2555 along with the foreign earned income exclusion.
The amount is 16% of the exclusion amount (figured on a daily ba- sis), multiplied by the number of days in your qualifying period that fall within your 2022 tax year. For 2022, this amount is $49.10 per day ($17,920 per year).
Publication 54 (2022), Tax Guide for U.S. Citizens and Resident Aliens Abroad (IRS)
The election sticks until you revoke it
The foreign earned income exclusion is voluntary and is chosen by completing the appropriate parts of Form 2555. Once you choose to exclude your foreign earned income, that choice remains in effect for that year and for every later year unless you revoke it. If you revoke the election, you cannot claim the exclusion again for the next five tax years without IRS approval. The choice also affects your foreign tax credit: once you exclude foreign earned income, you may not take a foreign tax credit or deduction for the taxes paid on the income you exclude. If you later do take a credit or deduction for those taxes, your exclusion election is automatically revoked starting with that year. Because the election sticks until you revoke it, taxpayers should consider their overall tax situation - including whether they would benefit more from the foreign tax credit - before making the choice in the first place.
Once you choose to exclude your foreign earned income, that choice remains in effect for that year and all later years unless you revoke it.
Publication 54 (2022), Tax Guide for U.S. Citizens and Resident Aliens Abroad (IRS)
How each figure was verified
Each number below was read from a stored copy of the document named beside it, and checked to occur word for word in the quoted sentence. The digest is of that stored text.
Rev. Proc. 2021-45 (IRS)
- Exclusion amount
the foreign earned income exclusion amount under § 911(b)(2)(D)(i) is $112,000