The Foreign Earned Income Exclusion is one of the most valuable tax provisions available to Americans living abroad, but many expats are unsure whether it applies to their situation. This FEIE calculator and eligibility checker helps you answer a critical question before tax season: does FEIE apply to me? For tax year 2026, the Foreign Earned Income Exclusion allows qualifying US citizens and residents to exclude up to $130,000 of foreign earned income from federal income tax. However, the FEIE only covers earned income, and many expats discover too late that their primary income sources do not qualify.
This FEIE eligibility checker walks you through each of your income sources and shows exactly which ones the foreign earned income exclusion covers and which ones it does not. Whether you earn a salary abroad, run a freelance business, collect investment dividends, or receive a pension, this FEIE income screener gives you a clear picture of your tax exposure before you file. Understanding your FEIE eligibility is the first step toward building a sound expat tax strategy.
How This FEIE Calculator and Eligibility Checker Works
The foreign earned income exclusion calculator on this page asks you to identify each of your income sources and enter the approximate annual amounts. It then categorizes each source as FEIE-eligible (earned income from services performed abroad) or non-eligible (passive income, pensions, Social Security, rental income). The tool calculates what percentage of your total income the FEIE can shelter, shows your estimated remaining US tax liability on non-qualifying income, and flags common issues that catch expats off guard.
If you are wondering does FEIE apply to me, the answer depends on three requirements. First, you must be a US citizen or resident alien. Second, your tax home must be in a foreign country. Third, you must meet either the bona fide residence test (a full calendar year of foreign residence) or the physical presence test (330 full days outside the US in any twelve-month period). This FEIE eligibility checker helps you evaluate all three criteria.
What Qualifies as Foreign Earned Income?
Foreign earned income includes wages, salaries, professional fees, bonuses, commissions, and self-employment income earned while your tax home is in a foreign country. The key word is earned: you must perform services to generate the income. Passive income such as dividends, capital gains, interest, rental income, and pension distributions does not qualify for the foreign earned income exclusion, regardless of where the assets are located or where you live when you receive the payments.
This distinction is why the FEIE income screener is so important. An American freelancer earning $100,000 from client work while living in Portugal can exclude all of that income under the FEIE. But an early retiree living in the same Portuguese apartment, drawing $100,000 from a 401(k) and brokerage account, gets zero benefit from the FEIE because none of that income is earned. The foreign earned income exclusion calculator shows you exactly where you stand.
The Self-Employment Tax Trap
A critical detail that many expats miss: even if the FEIE excludes your self-employment income from federal income tax, you still owe self-employment tax on that income. Self-employment tax covers Social Security and Medicare contributions at a combined rate of 15.3 percent on the first $168,600 of net self-employment earnings (2026) and 2.9 percent above that threshold. For a freelancer earning $100,000 abroad, that means roughly $14,130 in SE tax even when your federal income tax is zero thanks to the FEIE.
The only way to avoid this self-employment tax is if you live in a country that has a totalization agreement with the United States and you are covered by that country’s social security system. The US has totalization agreements with over thirty countries, including the UK, Canada, Germany, France, Australia, Japan, and South Korea. If you contribute to the local social security system in a totalization agreement country, you may be exempt from US self-employment tax. Our Social Security Abroad Checker can help you identify which countries have these agreements.
FEIE vs. Foreign Tax Credit: Which Is Better?
For expats with significant non-earned income, such as retirees, investors, or landlords, the Foreign Tax Credit (FTC) is often more valuable than the FEIE. The FTC lets you offset your US tax liability dollar-for-dollar with taxes paid to a foreign government. In high-tax countries like France, Germany, or the United Kingdom, the FTC can eliminate your US tax bill entirely. You can use both the FEIE and the FTC in the same tax year, but not on the same income. This FEIE calculator helps you determine which combination minimizes your overall tax burden.
The Expat Tax Burden Estimator models your combined US and local tax liability across fifteen popular expat destinations, taking both the FEIE and FTC into account. If you are planning a move abroad, running your numbers through both tools gives you a complete picture of your tax obligations.
Common Scenarios Where the FEIE Does Not Apply
The FEIE eligibility checker flags several common situations where Americans living abroad cannot use the foreign earned income exclusion. These include US military personnel stationed abroad (military pay has its own exclusion rules), US government employees (their income is sourced to the US regardless of where they work), retirees whose income comes entirely from pensions, Social Security, and investments, and digital nomads who spend fewer than 330 days outside the US in a twelve-month period. If the FEIE income screener indicates that most of your income does not qualify, the Foreign Tax Credit may be your primary tool for reducing your US tax burden.
Planning Your Tax Strategy Before You Move
The best time to understand your FEIE eligibility is before you relocate, not at tax time. Running your income through this foreign earned income exclusion calculator helps you set realistic expectations about your US tax liability abroad. Combine this analysis with the Geographic Arbitrage FIRE Calculator to understand total living costs, the Retirement Visa Eligibility Checker to confirm residency options, and the UK Frozen Pension Loss Calculator if you have UK pension entitlements. For a comprehensive overview of all available planning tools, visit our calculators hub.
Frequently Asked Questions
Does FEIE apply to me if I work remotely for a US company while living abroad?
Yes, in most cases. If your tax home is in a foreign country and you meet either the bona fide residence test or the physical presence test, your salary from a US employer generally qualifies for the foreign earned income exclusion. The FEIE eligibility checker above helps you confirm whether you meet the qualifying tests. Note that your employer will still withhold US taxes from your paycheck, and you will claim the FEIE exclusion when you file your annual return to get a refund.
Can I use the FEIE calculator for self-employment income?
Yes. Self-employment income earned abroad qualifies for the FEIE as long as you meet the residence or physical presence requirements. However, as the FEIE income screener will show, the exclusion only covers federal income tax. You will still owe self-employment tax (Social Security and Medicare) on your net self-employment earnings unless a totalization agreement applies.
What is the FEIE exclusion amount for 2026?
For tax year 2026, the foreign earned income exclusion amount is $130,000 per qualifying individual. This amount is adjusted annually for inflation by the IRS. Married couples who both live and work abroad can each claim the full exclusion, potentially sheltering up to $260,000 in combined earned income from US federal income tax.
Does FEIE apply to me if I am retired and living abroad?
Generally, no. The foreign earned income exclusion only applies to earned income from services performed abroad. Pension distributions, Social Security benefits, investment income, and retirement account withdrawals are not earned income and do not qualify. Retirees abroad typically rely on the Foreign Tax Credit and tax treaty provisions to manage their US tax obligations. The FEIE calculator above will confirm which of your income sources qualify and which do not.
Can I switch between the FEIE and the Foreign Tax Credit?
Yes, but with an important caveat. If you revoke your FEIE election, you cannot re-elect it for five years without IRS approval. This makes the initial choice significant. Use this FEIE eligibility checker alongside the Expat Tax Burden Estimator to compare both approaches before committing to one strategy.