Bona Fide Residence Test

WHAT IS THE BONA FIDE RESIDENCE TEST?

The bona fide residence test is one of two tests used in determining whether or not you are eligible to claim the Foreign Earned Income Exclusion or Deduction. The foreign earned income exclusion allows you to exclude income you earned from your annual taxes. If you meet certain requirements, you may qualify for the foreign earned income and foreign housing exclusions, as well as the foreign housing deduction.

HOW DO I MEET THE BONA FIDE RESIDENCE TEST?

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 includes an entire tax year. You can use the bona fide residence test to qualify for the foreign earned income and foreign housing exclusions and the foreign housing deduction only if you are either:

  • A U.S. citizen, or
  • A U.S. resident alien who is a citizen or national of a country with which the United States has an income tax treaty in effect.

You do not automatically acquire bona fide resident status merely by living in a foreign country or countries for 1 year.

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