Foreign Earned Income Exclusion Calculator
Calculate your foreign earned income exclusion (FEIE) for 2026. Estimate how much overseas income you can exclude and your federal tax savings.
Federal Income Tax Guide HubEstimate your foreign earned income exclusion instantly. Our calculator uses the official 2026 FEIE limit of $132,900 and helps US citizens and residents abroad understand how much income they can exclude from federal tax.
Foreign Income Excluded
$120,000
Qualifies for foreign earned income exclusion
Earned Income Exclusion
$120,000
Housing Exclusion
$0
Tax Impact
2026 FEIE Limit
Maximum foreign earned income exclusion: $132,900
Excluded income is added back for MAGI purposes in many cases. You generally cannot claim both FEIE and the foreign tax credit on the same income.
For informational purposes only. Housing exclusion calculations are simplified. Consult a tax professional for Form 2555 filing.
For a complete guide to qualification tests, housing exclusions, and MAGI impacts, see: Foreign Earned Income Exclusion Guide.
What Is the Foreign Earned Income Exclusion?
The foreign earned income exclusion (FEIE) allows qualifying US taxpayers to exclude a portion of their foreign earned income from US federal income tax. For tax year 2026, the maximum exclusion is $132,900 (up from $130,000 in 2025).
This is one of the most valuable tax benefits for Americans working abroad — but you must meet strict qualification tests and file Form 2555 with your tax return.
Who Qualifies for FEIE?
To claim the exclusion, you must meet all of these requirements:
- Your tax home is in a foreign country
- You have foreign earned income (wages, salary, or self-employment from foreign sources)
- You meet either the bona fide residence test or the physical presence test
Physical Presence Test
You must be physically present in a foreign country for at least 330 full days during any 12-month period that includes part of the tax year. Travel days and brief US visits count against you.
Bona Fide Residence Test
You must be a bona fide resident of a foreign country for an entire tax year (January 1 through December 31). This requires establishing a genuine home abroad with no definite intent to return to the US.
2026 FEIE Limits
| Item | 2026 | 2025 |
|---|---|---|
| Maximum earned income exclusion | $132,900 | $130,000 |
| Housing exclusion | Separate calculation | Separate calculation |
The housing exclusion is additional — it covers qualifying housing expenses above a base amount set by the IRS for your location. Use Form 2555 to calculate the exact housing exclusion.
How FEIE Affects Your Taxes
Tax savings: Excluded income is not subject to federal income tax, which can save thousands for expats in higher brackets.
MAGI impact: Excluded foreign earned income is added back when calculating Modified Adjusted Gross Income for many purposes, including Roth IRA eligibility and the premium tax credit. Use our MAGI Calculator to see the full picture.
Foreign tax credit: You generally cannot claim both the FEIE and the foreign tax credit on the same income. You must choose which benefit is more valuable — FEIE for low-tax countries, FTC for high-tax countries.
FEIE vs. Foreign Tax Credit
| Factor | FEIE | Foreign Tax Credit |
|---|---|---|
| Best for | Low/no foreign tax countries | High foreign tax countries |
| Self-employment tax | Still owed on excluded income | Still owed |
| State taxes | May still apply | May still apply |
| Form required | Form 2555 | Form 1116 |
Common FEIE Mistakes
Assuming all overseas income qualifies: Investment income, pensions, and US-source wages are not eligible for FEIE — only earned income from foreign sources counts.
Missing the 330-day threshold: Counting partial travel days incorrectly can disqualify you. Keep detailed travel records.
Forgetting self-employment tax: FEIE excludes income from income tax but not from Social Security and Medicare taxes on self-employment income.
Not filing Form 2555: You must actively claim the exclusion on your return. It is not automatic.
Worked Example
Scenario: Single filer, $140,000 foreign salary, meets physical presence test (335 days abroad), $22,000 marginal rate.
- Maximum exclusion: $132,900
- Taxable foreign income: $140,000 − $132,900 = $7,100
- Estimated tax savings: $132,900 × 22% = $29,238
Key Takeaways
- 2026 FEIE limit: $132,900 per qualifying taxpayer
- Must meet physical presence (330 days) or bona fide residence test
- File Form 2555 to claim the exclusion
- Cannot double-dip with foreign tax credit on same income
- Excluded income affects MAGI for other tax benefits
Related: Foreign Earned Income Exclusion Guide | MAGI Calculator | Federal Tax Bracket Calculator
This tool is for informational purposes only and does not guarantee accuracy for your specific tax situation.