Foreign Earned Income and 401K
For a US citizen working in a foreign country (no tax treaty) for a US based corporation how do 401Ks and IRAs factor in? Does the tax filer simply choose NOT to exclude a portion of income so that income can go to 401K and/or IRA contribution for that year? As long as the income/salary/earned income is able to be taxed then it can be sent to Traditional 401K or Traditional/Roth IRA correct? End product is that this income will NOT be federally taxed as it will go to retirement, but it has to be available to be taxed, correct? If tax payer makes more than $95,100 per year then the amount above this could be used to put toward retirement or any amount not included in the Foreign Earned Income exclusion whether it is money generated in the US or not, correct? The monies just have to be available to be taxed, correct?
For a US citizen working in a foreign country (no tax treaty) for a US based corporation how do 401Ks and IRAs factor in? Does the tax filer simply choose NOT to exclude a portion of income so that income can go to 401K and/or IRA contribution for that year? As long as the income/salary/earned income is able to be taxed then it can be sent to Traditional 401K or Traditional/Roth IRA correct? End product is that this income will NOT be federally taxed as it will go to retirement, but it has to be available to be taxed, correct? If tax payer makes more than $95,100 per year then the amount above this could be used to put toward retirement or any amount not included in the Foreign Earned Income exclusion whether it is money generated in the US or not, correct? The monies just have to be available to be taxed, correct?
Last edited: