Korean Job Discussion Forums

jrwhite82 · Joined: 22 May 2010

So here's my situtation.

GEPIK teacher salary (Round abouts $22,000). Didn't pay tax in Korea or America all year. I had a baby in Korea. I am working on my taxes. I don't qualify for the $1000 child credit because I don't have any income in the US and my son was born here. If I don't file the foreign income exclusion, is that against the rules and or stupid? It might work out for me in the end by not claiming it. I have student loan, charity, and other types of deductions, plus the standard deduction. Also have a wife who didn't work due to pregnancy/baby care.

Also, is the Earned Income Credit gone?

So I'm assuming if I report the income without the foreign exclusion but with my other deductions, I'm gonna owe a little bit on it to Uncle Sam. But will it be more than the $1000 credit from having the baby?

Any advice?

If what I am asking is illegal/against the rules, I will delete this post.

ttompatz · Joined: 05 Sep 2005 Location: Kwangju, South Korea

form 2555 (and the 1040 of course).... foreign earned income deduction/exemption ($92,000)... You don't pay tax on your Korean income and it is legitimate. Not filing it is just plain foolish.

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jrwhite82 · Joined: 22 May 2010

That's what I figured. But with all my deductions my tax liability is very small. Plus taking the 2555 also cancels the chance to claim the $1000 child credit. So that is $1000 cash. Not a $1000 deduction. I'm not sure if he qualifies for the credit because he didn't live in America yet. He is a US citizen though. Then there is the matter of the Earned Income Credit. But I think that is gone Yes?

nathanrutledge · Joined: 01 May 2008 Location: Marakesh

Read the instructions on the tax forms. AFAIK you don't HAVE to file the 2555. Simply put the earned income on your 1040 and pay your taxes on it. You incur tax liability, you pay the taxes and get the credit.

Read the the directions on the form, what do they say on this issue?

jrwhite82 · Joined: 22 May 2010

I'm turbotaxing.

I will try running it twice tonight after work. Once with the 2555 and once without and see which one gets the larger refund. Then just double check to make sure it is legit.