What changed
The IRS announced on November 5, 2026 that the foreign earned income exclusion amount for tax year 2027 is $137,300, up from $132,900 for tax year 2026. The increase is a tax-year adjustment; it does not change the amount for 2026 income.
Who can use it
The foreign earned income exclusion is not automatic. IRS instructions describe foreign earned income and requirements involving a foreign tax home and either the bona fide residence test or the physical presence test. The amount available to an individual depends on their qualifying income and circumstances.
What to do next
Keep records of where income was earned and your travel and residence, and check the IRS instructions for Form 2555 for the relevant tax year. If you have unfiled returns or a complicated situation, get advice that accounts for your facts.
Need filing help?
FileAbroad, another business operated by the publisher, offers US tax filing help for Americans abroad. See the source below and consult a qualified professional before making decisions.
This article was prepared with AI assistance and may contain errors. It is general information, not personalized tax, legal or financial advice. Rules change; consult the linked official sources and a qualified professional about your circumstances.