Form 1116 and Canadian Tax Refund

nelsona · Post by **nelsona** » Sat Mar 21, 2009 3:57 pm

Sure. The issue with a part-year 255 is that you can't claim the entire ~85K as an exemption limit. The limit is pro-rated based on the number of days of 365 that the foreign place was your tax home.

jgoveas · Post by **jgoveas** » Sun Mar 22, 2009 12:54 pm

Thanks nelsona.

I have a question about the housing exclusion in 2555. My problem with this form is that it really reads as if it's meant for US citizens and residents who move to from the US to another country. And of course for me it's the opposite which makes the bonafide test and physical presence test questions hard to understand and fill out. Either way, according to the instructions on form, you're allowed to deduct housing expenses including rent! Unless I'm missing something and I fill out this form, I exclude housing expenses for the part of the year I was in Canada upto a certain amount of course. Is this true? It seems unbelievable!

On a side note, for anyone interested, a friend on another forum shared a very cool link that explains in 'for dummies' fashion how to file form 1116. http://74.125.47.132/search?q=cache:TXe ... clnk&gl=us

The link and learn site of the IRS is also pretty cool for people trying to wrap their heads around forms http://www.irs.gov/app/vita/international_module.jsp

nelsona · Post by **nelsona** » Sun Mar 22, 2009 4:11 pm

You meet PPT for 2555 purposes. The 360 day periods ENDS when you came to US

jgoveas · Post by **jgoveas** » Sat Mar 28, 2009 8:49 am

One last clarification on this topic. For 2555, it states that Your tax home must be in a foreign country. I'm assuming this refers to the 330 days that you use as that PPT and not necessarily where your current tax home is (which for us would be the US now as of Dec 31st 08)?

Thanks nelsona!

nelsona · Post by **nelsona** » Sat Mar 28, 2009 2:28 pm

I think you can figure this out.