IRS Form 2555: Who It’s For, How It Works & Filing Instructions

Form 2555 is the IRS form U.S. citizens and resident aliens living abroad use to claim the foreign earned income exclusion and the foreign housing exclusion or deduction. You attach it to Form 1040, and you file it only if you choose to claim those benefits.

The foreign earned income exclusion (FEIE) allows you to exclude up to $132,900 of foreign earned income from U.S. income tax on your 2026 tax return, filed in 2027. Housing benefits can further reduce your taxable income when housing abroad is expensive.

You can file Form 2555 if your tax home is in a foreign country, you meet the physical presence test or the bona fide residence test, and you have foreign earned income. U.S. citizens are taxed on worldwide income, so you still report your foreign pay on your return, and Form 2555 subtracts the part you qualify to exclude.

What Is Form 2555?

Form 2555, Foreign Earned Income, is the IRS tax form used to claim the foreign earned income exclusion, the foreign housing exclusion, or the foreign housing deduction. You attach it to Form 1040 or 1040-SR. Because it is the only way to claim the exclusion, IRS Form 2555 is often called the foreign earned income exclusion form.

Form 2555 Claims Three Tax Benefits

1. Foreign earned income exclusion: excludes up to $132,900 of foreign earned income for 2026 (Part VII).
2. Foreign housing exclusion: excludes part of housing costs paid with employer-provided amounts (Part VI).
3. Foreign housing deduction: deducts part of housing costs paid from self-employment income (Part IX). Our foreign housing exclusion guide explains the limits.

Who Should File Form 2555?

You should file Form 2555 if you’re a U.S. citizen or resident alien with a foreign tax home, you meet the physical presence or bona fide residence test, and you want to exclude foreign earned income or claim housing costs. No one needs to file it otherwise, because claiming the exclusion is optional.

You Need All Three Requirements

• A foreign tax home: your main place of work is outside the United States for the entire qualifying period, and your abode (where your home and personal ties are) isn’t in the United States, unless you’re serving in support of the U.S. Armed Forces in a combat zone. Our FAQ on tax home with no permanent address covers frequent movers.
• One residency test: the Physical Presence Test (330 full days abroad in 12 consecutive months) or the Bona Fide Residence Test (residence abroad for a full tax year). Our guide on bona fide residence vs. physical presence test compares them.
• Foreign earned income: pay for work you performed in a foreign country.

Remote workers who travel can check our guide to digital nomad taxes, and the FEIE waiver covers leaving a country because of war or civil unrest.

Excludable income still counts toward the filing requirement, so you may need to file a U.S. return even if you’ll owe nothing. Our FAQ on expat income filing threshold lists the amounts.

Only Pay for Work Abroad Counts as Foreign Earned Income

Only pay for work you performed abroad can be excluded. Investment income, pensions, and U.S. government pay stay outside Form 2555.

Counts as foreign earned income	Doesn’t count
Wages, salaries, bonuses, and commissions for work abroad	Pensions, annuities, and Social Security; see foreign pension taxation
Self-employment income and professional fees for work abroad	Interest, dividends, capital gains, and rental income; see earned vs. unearned income
Noncash pay, such as employer-provided housing or a car	Pay from the U.S. government as its employee
Allowances and reimbursements for living abroad	Pay received after the year following the year you earned it

Pay for work performed in the United States is U.S. income, even from a foreign employer. Our article on foreign vs. U.S. source income explains the sourcing rules, and our FAQ on passive income and the FEIE covers rental income and Social Security.

Some Filers Can’t Use Form 2555

Your situation	Can you use Form 2555?
U.S. citizen abroad who meets either test	Yes
Resident alien	Yes, under the physical presence test; the bona fide residence test only if you’re a citizen or national of a U.S. treaty country
U.S. government employee abroad	No, for pay from the U.S. government
Time in Cuba in violation of U.S. travel restrictions	No, for that time and income (service at Guantanamo Bay is an exception)
Using only the Foreign Tax Credit	Not needed; the credit uses Form 1116

Married couples who both qualify each complete a separate Form 2555, even on a joint return, and community property rules don’t change either spouse’s exclusion. Our FAQ on both spouses claiming the FEIE runs through the math.

What Should You Weigh Before Claiming the Exclusion?

Claiming the exclusion on Form 2555 changes other parts of your return, and the choice carries into later years until you revoke it. The trade-offs involve refundable credits, the Foreign Tax Credit, IRAs, self-employment tax, and state tax, so check each one before you file.

Claiming the Exclusion Affects Credits and Other Taxes

If you claim the exclusion or housing deduction	What changes
Additional child tax credit	You can’t claim the refundable portion of the child tax credit for expats
Earned income credit	You can’t claim it
IRA contributions	Special rules apply to your IRA deduction; see IRAs for expats and our FAQ on IRA contributions with the FEIE
Foreign Tax Credit	No credit for foreign tax on excluded income; it still applies to income you don’t exclude
Self-employment tax	U.S. expat self-employment tax still applies to all net earnings unless a totalization agreement applies
State income tax	Some states, such as California, tax the excluded income; see our FAQ on states and the FEIE

Revoking the Choice Has a Five-Year Wait

The choice remains in effect for future years unless you revoke it by attaching a statement to your return. After a revocation, you can’t claim the exclusion again for 5 tax years without IRS approval. A year with no foreign earned income doesn’t require a revocation. Our guides on FEIE revocation, FEIE vs. FTC, and claiming both the FEIE and the Foreign Tax Credit help you compare.

How Do You Fill Out Form 2555?

To fill out Form 2555, complete it page by page: page 1 for your details and the bona fide residence test, page 2 for the physical presence test and your foreign earned income, and page 3 to calculate your exclusions.

These Form 2555 instructions follow the 2026 draft Form 2555 the IRS posted in September 2026, along with draft Instructions for Form 2555. A draft can still change, so check the final form before filing Form 2555.

Form 2555 Has Nine Parts on Three Pages

Page	Part	Who completes it	Lines
1	I: General Information	Everyone	1 to 9
1	II: Bona Fide Residence Test	Filers using that test	10 to 15e
2	III: Physical Presence Test	Filers using that test	16 to 18
2	IV: Foreign Earned Income	Everyone	19 to 26
3	V: All Taxpayers	Everyone	27
3	VI: Housing Exclusion and Deduction	Anyone claiming housing costs	28 to 36
3	VII: Foreign Earned Income Exclusion	Anyone claiming the FEIE	37 to 42
3	VIII: Total Exclusions	Anyone claiming either exclusion	43 to 45
3	IX: Housing Deduction	Mainly self-employed filers with housing costs	46 to 50

Gather These Records Before You Start

• Travel dates: the days you entered and left each country, including any U.S. trips.
• Employer details: names, addresses, and whether each employer is foreign or U.S.
• Pay records in U.S. dollars: converted at the exchange rate in effect when you received the pay; see IRS foreign exchange rates.
• Housing costs: rent, utilities, and insurance, if you’re claiming housing.
• Prior filings: the last year you filed Form 2555 and any past revocation.

Our FAQ on what Greenback needs to prepare your expat tax return lists the rest.

1. Complete Page 1: Your Details and the Bona Fide Residence Test

Part I (lines 1 to 9) records your address, employer, citizenship, and tax home. Part II (lines 10 to 15e) is only for the bona fide residence test. If you use the physical presence test, skip Part II.

What to double-check:

• Lines 6a to 6d: the last year you filed Form 2555 and any past revocation.
• Line 9: every tax home you had during the year and when you established it.
• Lines 13a and 13b: if you told the foreign country you aren’t a resident, and you aren’t required to pay its income tax, you don’t qualify as a bona fide resident.

2. Complete Page 2: The Physical Presence Test and Your Foreign Earned Income

Part III (lines 16-18) is only for the physical presence test. Part IV (lines 19 to 26) totals the foreign earned income you earned and received in 2026, in U.S. dollars. Pay earned in a prior year is subject to separate rules in the instructions, and pay for work performed in the United States remains outside Part IV.

What to double-check:

• Line 16: the IRS lets you choose the 12-month period that provides the greatest exclusion, but only days when your tax home is abroad also count. Our FAQs on 330 days across two calendar years, the 35-day U.S. limit for the FEIE, and counting days in multiple countries cover the details.
• Lines 21 and 22: employer-provided housing, a car, and cost-of-living or education allowances count as income. See our FAQ on employer-provided housing allowances.
• Line 26: your 2026 foreign-earned income, which carries over to line 27 on page 3.
• Bonuses and equity pay: pay you receive in the year after you earned it can still be excluded, but pay received after the end of that following year can’t be. Our FAQ on the FEIE on stock options and RSUs covers equity awards.
• Withholding: Form 673 asks a U.S. employer to stop withholding on pay you expect to exclude; our FAQ on stopping U.S. employer withholding walks through it.

3. Complete Page 3: Calculate Your Exclusions

Page 3 applies your foreign earned income to the exclusion. Line 27 repeats your foreign earned income, then:

• Part VI (lines 28 to 36): your housing amount above the 2026 base on line 32 of $58.26 per day ($21,264 for a full year) and any housing exclusion.
• Part VII (lines 37 to 42): the $132,900 maximum, prorated by your qualifying days on lines 38 to 40. Line 42 is your exclusion.
• Part VIII (lines 43 to 45): line 43 adds your two exclusions, line 44 subtracts deductions tied to excluded income, and line 45 is your total exclusion, which you carry to Schedule 1 (Form 1040), line 8d.
• Part IX (lines 46 to 50): the foreign housing deduction, mainly for self-employed filers, only if line 33 is more than line 36 and line 27 is more than line 43. Line 49 carries over any housing deduction you couldn’t use in the prior year.

What to double-check:

• Line 34: all amounts your employer paid you, including salary. If you’re entirely self-employed, it’s zero, and your housing amount may qualify for the deduction in Part IX instead. Our foreign housing exclusion calculator estimates it.
• Line 39: divide your qualifying days on line 38 by the days in your tax year (365 for 2026) and round to at least three decimal places. A full year is “1.000,” and a partial first or final year abroad is prorated.
• Self-employed filers: our FAQ on the FEIE on self-employment income and our guide to Schedule SE for expats cover the other forms you’ll file.

What Does a Form 2555 Example Look Like for a First-Year Mover?

A first-year mover usually claims a prorated exclusion. In this Form 2555 example, Dana, a single filer who moves abroad in summer 2026, excludes $55,685.10 of her $75,000 in foreign salary on her 2026 Form 2555. She uses a Form 2350 extension because she meets the physical presence test after June 15, 2027.

Dana Moves Abroad Midyear

Dana leaves her U.S. job at the end of July 2026 and lands in Lisbon on July 31. Her first full day abroad is August 1. She stays abroad with no U.S. trips through June 2027 and earns a foreign salary of $180,000 a year, so she earns $75,000 from August through December. Her $70,000 in U.S. wages from January to July isn’t foreign-earned income and remains fully taxable.

Dana’s Form 2555 Lines

Line	Entry	Amount
16	12-month period	August 1, 2026 to July 31, 2027
27	Foreign earned income	$75,000
38	Qualifying days in 2026	153
39	153 ÷ 365, rounded	0.419
40	$132,900 × 0.419	$55,685.10
41	Line 27 minus housing exclusion (none)	$75,000
42	Smaller of line 40 or line 41	$55,685.10

Dana’s qualifying days start August 1, when both her tax home and her presence are abroad. She reaches 330 full days on June 26, 2027. $19,314.90 of her foreign salary stays taxable, along with her U.S. wages, and she files Form 2350 by June 15, 2027, to extend her deadline past the date she qualifies.

Where Does the Foreign Earned Income Exclusion Go on Form 1040?

The foreign earned income exclusion from Form 2555, line 45, is reported on Schedule 1 (Form 1040), line 8d, as a negative amount, and the housing deduction from line 50 is reported on Schedule 1, line 24j. Schedule 1 carries both to Form 1040, where they reduce your income.

Our guides to Schedule 1 (Form 1040) and U.S. taxes while living abroad show how Form 2555 fits with your other filings.

Lines 45 and 50 Carry to Schedule 1

Form 2555 line	Goes to	What it does
Line 45: total exclusions	Schedule 1, line 8d (in parentheses)	Subtracts the excluded income
Line 50: housing deduction	Schedule 1, line 24j	Reduces your adjusted gross income

The Foreign Earned Income Tax Worksheet Sets Your Tax Rate

If you enter an amount on line 45 or line 50, you calculate your tax with the Foreign Earned Income Tax Worksheet in the Form 1040 instructions. It taxes your remaining income at the rates that would apply if the excluded income were included, so your bracket can be higher than your taxable income suggests. Our FAQ on the FEIE stacking rule and our guide to standard deduction and tax brackets show how it plays out.

When Is Form 2555 Due?

Form 2555 is due with your Form 1040 on April 15, 2027, for a 2026 return, or on June 15, 2027, if you live and have your tax home outside the United States. Interest still runs from April 15 on any tax not paid by then. Form 4868 extends filing to October 15, 2027.

Your Deadline Depends on Where You Live

Deadline	Who it applies to	What to know
April 15, 2027	Everyone	Regular due date for filing and paying
June 15, 2027	U.S. citizens and residents living abroad	Automatic with an attached statement; interest runs from April 15
October 15, 2027	Anyone who files Form 4868	Extends the time to file only

Our FAQ on June 15 extension interest explains the interest, and our U.S. tax filing deadlines for expats guide lists every date.

First-Year Filers Can Wait or Amend

If you haven’t met the residency test by the filing deadline for Form 2555 in your first year abroad, you can wait with Form 2350 or file on time and amend later.

Option	How it works	What to know
Wait with Form 2350	File Form 2350 by your due date to extend past the date you expect to qualify	The extension covers filing; tax paid later still accrues interest
File now, amend later	File on time reporting all income, then file an amended tax return (Form 1040-X) with Form 2555 once you qualify	Form 1040-X is generally due within 3 years of filing or 2 years of paying, whichever is later

Late Claims Are Still Possible in Many Cases

You may still be able to claim the exclusion late. Under the regulations the IRS follows, the choice can be made to file a timely return, including extensions, an amended return within the refund period, or an original return filed within one year of April 15. After that, it can still be made if you owe no tax after the exclusion, or if you file before the IRS discovers you didn’t make the choice. A return filed this way must say “Filed Pursuant to Section 1.911-7(a)(2)(i)(D)” at the top of the first page of Form 1040.

To catch up, see our FAQ on claiming the FEIE retroactively, our guide for late tax filing for expats, and the IRS Streamlined Filing Procedures.

Frequently Asked Questions about Form 2555

Qualifying Days and Foreign Pay Set Your Form 2555 Exclusion

Form 2555 excludes only what your qualifying days, foreign earned income, and housing costs support. It also doesn’t replace other filings such as the FBAR, which our guide to U.S. expat taxes covers, and our Foreign Earned Income and Exclusions Q&A answers narrower questions.

• If you’re a first-year expat, your first Form 2555 sets up the years that follow. Learn more about how we help Americans moving abroad.
• If you’re a self-employed expat, the housing deduction and self-employment tax both need careful handling. Learn more about how we help self-employed expats.
• If you’re returning to the United States, your final year abroad is usually prorated too. Learn more about how we help Americans returning to the U.S.
• If you’re a U.S. citizen living abroad, Form 2555 is often central to your return. Learn more about how we help U.S. citizens living abroad.

Get Your Form 2555 Right the First Time

Greenback handles prorated exclusions, housing amounts, and Schedule 1 so you can file with confidence.

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This article is for general information only and does not constitute tax or legal advice. Line numbers are based on the 2026 draft Form 2555 and draft instructions, which the IRS may change before the final release. Your situation may differ, so consult a qualified tax professional with expertise in expat taxes before acting on this information.