1040NR or 2555(Foreign Earned Income)

[MariaMc]

Have read instructions to both these forms and am still unclear how I should file.

I have a client who moved back to the Middle East. He was born overseas but became a U.S. citizen while he lived and worked in the U.S. for about 10 years. He filed U.S. tax returns during all this time. He moved back overseas a couple of years ago and is employed by a foreign company, married and has a child. He has not ruled out moving back to the U.S. at some point. Should I be reporting his income under Form 2555 and claim the foreign earned income exemption rule or do I need to file 1040NR and actually pay U.S. tax on this income ?

Thanks....

[Uncle Sam]

1040nr/2555

What's important is which country is he a citizen?

If a U. S. citizen- then he should file a 1040 and complete Form 2555 provided he qualifies.

If a citizen of a foreign country and works for a U. S. company, then I believe it would be appropriate to file the 1040NR.

[OtisMozzetti]

I have a client who moved back to the Middle East. He was born overseas but became a U.S. citizen while he lived and worked in the U.S. for about 10 years. He filed U.S. tax returns during all this time. He moved back overseas a couple of years ago and is employed by a foreign company, married and has a child. He has not ruled out moving back to the U.S. at some point. Should I be reporting his income...

If he has still been a U.S. citizen, then he must report all of his worldwide income on a U.S. tax return if there is enough of that income to have a filing requirement. If he meets the qualifications, some of that income might be excluded from tax under the foreign earned income exclusion.