Korean Job Discussion Forums

[tonyvu]

is it possible to file a return on US earnings by april 15th and then, with the automatic 2-month extension, separately file the foreign income return (she is currently here in korea and will pass the physical presence test in late May)?

[air76]

You don't need to do that.

As long as you're here for a year contract you qualify for the bona fide resident test...you don't have to be here for an entire year before you qualify.

What you do need to do is write the date on form 2555 for when the contract ends....so if you came in May 2009....write May 2009 - May 2010 on your form 2555, even if this is in the future this is OK.

Any time you're in the country for a partial year you're going to have to pro-rate your foreign income exemption anyhow....so just calculate the number of days you were in Korea in 2009 and divide by 365, then multiple this ratio by 94,500 on form 2555, then score out 94,500 and write this new exemption number. This new number will still be WELL above the amount of money earned in Korea in 2009, meaning all of your income will be exempt.

However, taxes will be due on any money earned in the US in 2009 prior to coming to Korea...but with nearly $10,000 in standard deductions this shouldn't be much, and it will be $0 if you earned less than 10 grand in the US in 2009.