Form 2555 and Form 8833

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nanic
Posts: 55
Joined: Mon Nov 21, 2011 2:26 pm

Form 2555 and Form 8833

Post by nanic »

So I filed my 2017 1040 along with form 8833 claiming at treaty exemption for my and my wife gross employment income as per article XIX of the Canada-US tax treaty. We are dual citizens and both work for the Federal government. Therefore I had no employment income to report on the 1040. I just received a letter from the IRS asking me to fill out form 2555 saying they need more info. Never need it in the past. The only difference this year is I filled using the IRS Free file.

Doesn't form 8833 supersede form 2555?
nelsona
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Post by nelsona »

Of course
They probably looked at your exempted income and mistook it for FEIE.

Write them and reiterate your Government Services treaty exemption.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
nanic
Posts: 55
Joined: Mon Nov 21, 2011 2:26 pm

Post by nanic »

Thanks Nelsona. Since I used IRS free file, I wonder if they even saw my form 8833. The only other reason for the form 2555 would be for the presence test. I am getting a Refundable American opportunity credit for my kids tuition I paid.

I will reply to the form letter with a copy of my Form 8833 and confirm that all of my income is exempt as per Treaty.
nanic
Posts: 55
Joined: Mon Nov 21, 2011 2:26 pm

Post by nanic »

One more thing. I never indicated on my 1040 my gross income. I just attached form 8833. However as I said, when I e-filed last year with TAXACT never had an issue.
nelsona
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Post by nelsona »

Well, only your wages are exempt. You still have to report all other income.

Why would taxact let you file an incomplete return last year? Or did you indicate your gross income was zero?

There is no presence test for US citizens, unless you file 2555. So don't bother with that.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
nanic
Posts: 55
Joined: Mon Nov 21, 2011 2:26 pm

Post by nanic »

Yes I indicated my gross income on form 8833 and indicated it was exempt as per treaty. However I did not indicate it on the 1040. Should I have put it on the 1040 and put a negative on another line? The only other income is within my RRSP.
nelsona
Posts: 18311
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Post by nelsona »

No other income? Really?

That may be why IRS questioned. That would seem pretty unusual to IRS.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
nanic
Posts: 55
Joined: Mon Nov 21, 2011 2:26 pm

Post by nanic »

Yes really. As I said, I have income in my RRSP, but that is not declared. Working-full time for government. Paying bills. No money left.

Anyway thanks for your help. Much appreciated.
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