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Free Tool for US Taxpayers

FEIE Calculator

Check if you qualify for the Foreign Earned Income Exclusion, test the 330-day Physical Presence rule, and estimate your tax savings — up to $130,000 excluded for 2026.

Physical Presence TestBona Fide ResidenceUp to $130K excludedForm 2555

Physical Presence Test

You must be physically present outside the US for at least 330 full days during any 12-month period.

Disclaimer: This calculator provides estimates for informational purposes only. It is not tax advice. Tax situations vary — consult a qualified tax professional for personalized guidance. Calculations are simplified and may not account for all IRS rules, housing deductions, or treaty benefits.

Understanding the Foreign Earned Income Exclusion

The Foreign Earned Income Exclusion (FEIE) is one of the most valuable tax benefits available to US citizens and resident aliens living abroad. Under IRC Section 911, qualifying individuals can exclude up to $130,000 (for 2026) of their foreign earned income from US federal income tax.

Unlike most countries that use territorial taxation (you pay tax where you earn), the US taxes its citizens on worldwide income regardless of where they live. The FEIE provides partial relief from this by allowing you to exclude foreign earned income — but only if you meet one of two qualifying tests.

The Two Qualifying Tests

To claim the FEIE, you must satisfy either the Physical Presence Test or the Bona Fide Residence Test:

  • Physical Presence Test (330-Day Rule):You must be physically present in a foreign country or countries for at least 330 full days during any consecutive 12-month period. This is the more objective test and is preferred by most digital nomads because it doesn't require establishing residence in any single country.
  • Bona Fide Residence Test: You must be a genuine resident of a foreign country for an entire tax year (January 1 – December 31). The IRS looks at factors like the duration and nature of your stay, whether you have a permanent home abroad, and your ties to the foreign country.

FEIE Exclusion Limits by Year

$120,000

Tax year 2024

$126,500

Tax year 2025

$130,000

Tax year 2026

$133,500 (est.)

Tax year 2027

Key Considerations for Digital Nomads

  • Tax home requirement: Your tax home must be in a foreign country. If you don't have a regular place of business, the IRS may consider your tax home to be wherever you live — so maintaining a base abroad helps.
  • Self-employment tax still applies: The FEIE only excludes income from federal income tax. Self-employment tax (Social Security + Medicare, 15.3%) still applies unless you qualify for an exemption through a totalization agreement.
  • State taxes vary: Some US states (like California) don't recognize the FEIE and may still tax your worldwide income. Check your state's rules or consider establishing residency in a no-income-tax state.
  • Foreign Housing Exclusion: In addition to the FEIE, you may be able to exclude or deduct certain foreign housing costs. This is claimed on the same Form 2555.

Frequently Asked Questions

What is the Foreign Earned Income Exclusion (FEIE)?
The FEIE allows qualifying US citizens and resident aliens living abroad to exclude a certain amount of foreign earned income from US taxation. For 2026, the exclusion limit is $130,000. You claim it using IRS Form 2555. It applies only to earned income (salary, self-employment) — not investment income, pensions, or Social Security.
What is the Physical Presence Test?
The Physical Presence Test requires you to be physically present in a foreign country (or countries) for at least 330 full days during any consecutive 12-month period. The 12-month period doesn't have to align with the calendar year — any 365-day window works. "Full day" means 24 hours, so days of international travel where you're in the air don't count for either side.
What is the Bona Fide Residence Test?
The Bona Fide Residence Test requires you to be a bona fide resident of a foreign country for an uninterrupted period that includes an entire tax year (January 1 – December 31). Unlike the Physical Presence Test, short trips back to the US don't disqualify you — what matters is that your established residence remains abroad. The IRS considers factors like the nature, duration, and purpose of your stay.
How much can I exclude with FEIE in 2026?
For tax year 2026, the maximum exclusion is $130,000 per qualifying individual. This amount is adjusted annually for inflation. For 2025 it was $126,500, and for 2024 it was $120,000. If you qualify for only part of the year, the exclusion is prorated based on the number of qualifying days.
Can I still claim FEIE if I visit the US?
Yes, under the Physical Presence Test, you can spend up to 35 days in the US during your 12-month qualifying period (365 minus 330 = 35). Under the Bona Fide Residence Test, short visits to the US generally don't disqualify you as long as your tax home remains abroad. However, extended US stays could jeopardize your bona fide residence status.
What counts as "foreign earned income"?
Foreign earned income includes wages, salaries, professional fees, and self-employment income for services performed in a foreign country. It does NOT include: passive income (dividends, interest, capital gains), pensions or annuities, US government employee pay, or income earned during periods you don't meet either qualifying test.
Can I use FEIE with the Foreign Tax Credit?
You can use both in the same year, but not on the same income. Income excluded under FEIE cannot also generate a Foreign Tax Credit. If your foreign income exceeds the FEIE limit, you can apply the Foreign Tax Credit to the remaining taxable portion. Choosing the right combination depends on the tax rates in your country of residence.
What happens if I revoke my FEIE election?
If you revoke your FEIE election, you cannot re-elect it for 5 tax years without IRS approval. This is an important consideration — once you stop using FEIE, you're locked out for 5 years. Think carefully before revoking, especially if you might return to living abroad.
Do digital nomads moving between countries qualify?
Yes. For the Physical Presence Test, you need 330 days outside the US — it doesn't matter if you moved between 10 different countries. For the Bona Fide Residence Test, the IRS typically wants to see a settled, established residence in one country, which can be harder to demonstrate as a nomad. Most nomads qualify through the Physical Presence Test.
Is this calculator a substitute for professional tax advice?
No. This calculator provides estimates based on general IRS rules. Your actual tax situation depends on many factors including state tax obligations, tax treaties, the Foreign Housing Exclusion, self-employment tax, and more. Always consult a qualified tax professional experienced in expat taxation before making decisions based on these calculations.

Track Your Tax Residency Across Countries

FEIE is just one piece of the puzzle. Track tax thresholds in every country you visit and get alerts before you trigger residency.

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