About the Foreign Earned Income Exclusion Calculator
This calculator estimates how much foreign salary or self-employment income a US citizen or resident living abroad can exclude from US income tax in 2026 using the foreign earned income exclusion (FEIE) and the foreign housing exclusion on Form 2555. Enter your foreign earned income, the number of qualifying days that fall in 2026, and your foreign housing costs, and it works out both exclusions and the US tax still owed on any remaining income.
For 2026 the maximum exclusion is $132,900 (Rev. Proc. 2025-32). Both it and the housing figures are prorated by qualifying days ÷ 365. The housing exclusion covers reasonable housing costs above a base amount of 16% of the maximum exclusion ($21,264 for a full year), up to a limit of 30% ($39,870) — or the higher limit the IRS publishes for expensive cities such as Hong Kong, London or Tokyo, which you can enter yourself.
The US tax estimate applies the stacking rule from the Foreign Earned Income Tax Worksheet: any income that is not excluded is taxed at the rates that would apply if the excluded income were still included, so the exclusion removes your lowest brackets, not your highest. It uses 2026 brackets and the standard deduction, treats all non-excluded income as ordinary income, and ignores foreign tax credits. You must qualify through the bona fide residence test or the physical presence test (330 full days abroad in 12 consecutive months), and self-employment tax still applies to excluded self-employment income.
With the default inputs, the total excluded income is $147,636.00. Change any value above to recalculate instantly.
How to use the foreign earned income exclusion calculator
- 1Enter your foreign earned income for 2026 in US dollars.
- 2Enter how many qualifying days (residence or physical presence) fall in 2026.
- 3Add your annual foreign housing costs and your city’s housing limit if it is higher than standard.
- 4Choose your filing status and any income that cannot be excluded.
- 5Review the exclusions, remaining taxable income and estimated US tax.
Formula and method
The housing exclusion is figured first: qualifying housing expenses, capped at the location limit (30% of the maximum exclusion by default) prorated for your qualifying days, minus the base amount of 16% of the maximum exclusion, also prorated. The foreign earned income exclusion is then the smaller of the prorated maximum ($132,900 × qualifying days ÷ 365) and your foreign earned income minus the housing exclusion. Self-employed people take the housing amount as a deduction rather than an exclusion; the tax effect is shown the same way here.
Taxable income is total income minus the exclusions and the 2026 standard deduction. Under the stacking rule (IRC §911(f)), the tax is the regular tax on taxable income plus the excluded amount, minus the regular tax on the excluded amount alone — so remaining income is taxed at the higher brackets.
- d
- Qualifying days in the tax year
- TI
- Taxable income after exclusions and standard deduction
- T(x)
- Regular 2026 federal tax on x for your filing status
Worked examples
Full year abroad, $150,000 salary, $36,000 rent
Housing costs of $36,000 minus the $21,264 base amount give a $14,736 housing exclusion. The remaining $135,264 of salary exceeds the $132,900 cap, so the full FEIE is used. Total exclusions of $147,636 plus the $16,100 standard deduction wipe out all US taxable income.
$220,000 salary, high-cost city, married filing jointly
Housing is capped at the $60,000 city limit, so the exclusion is $60,000 − $21,264 = $38,736. With the $132,900 FEIE, $171,636 is excluded and $16,164 remains taxable after the $32,200 standard deduction. Stacked on top of the excluded income it falls in the 22% bracket, giving about $3,556 of US tax instead of $30,740 without the exclusions.
Moved abroad mid-year: 200 qualifying days
With 200 qualifying days every figure is prorated by 200/365: the maximum exclusion is $72,822, the housing base $11,652 and the housing limit $21,847. Rent of $20,000 gives a housing exclusion of $8,348. After $81,170 of exclusions and the $16,100 standard deduction, $22,730 is taxable; stacked on the excluded income it is taxed mostly at 22%, about $5,001 instead of $17,570.
Frequently asked questions
What is the foreign earned income exclusion for 2026?+
The maximum foreign earned income exclusion for tax year 2026 is $132,900 per qualifying person (Rev. Proc. 2025-32). A married couple who both work abroad and qualify can each exclude up to $132,900 of their own earnings.
How do I qualify for the FEIE?+
Your tax home must be in a foreign country and you must pass either the bona fide residence test (resident of a foreign country for a full tax year) or the physical presence test (330 full days in foreign countries during any 12 consecutive months).
How is the foreign housing exclusion calculated?+
Qualifying housing costs above a base amount (16% of the maximum exclusion, $21,264 for 2026) are excludable up to a limit — 30% of the maximum ($39,870) unless the IRS sets a higher limit for your city. Both figures are prorated by qualifying days.
Does the FEIE reduce self-employment tax?+
No. Excluded self-employment income is still subject to US self-employment tax unless a totalization agreement between the US and your country of residence assigns social security coverage to that country.
What is the FEIE stacking rule?+
If you have income above the exclusion, the remaining income is taxed at the rates that would apply if the excluded income were included. In practice your taxable income starts at a higher bracket, which is why the calculator uses the Foreign Earned Income Tax Worksheet method.
Should I use the FEIE or the foreign tax credit?+
In high-tax countries the foreign tax credit often wipes out US tax without using the exclusion and preserves eligibility for IRA contributions and refundable credits. In low-tax countries the FEIE usually saves more. Revoking the FEIE bars you from re-electing it for five years without IRS consent.
Tax results are estimates based on published rules and simplified assumptions. They are not tax advice — check official guidance or a tax professional for your situation.
Sources
- IRS — Rev. Proc. 2025-32 (2026 inflation adjustments, §3.39 foreign earned income exclusion)
- IRS — Foreign housing exclusion or deduction
- IRS — Foreign earned income exclusion
- IRS — Publication 54, Tax Guide for U.S. Citizens and Resident Aliens Abroad
- 26 U.S. Code § 911 — Citizens or residents of the United States living abroad