Who must file.   Your age, filing status, gross income, and whether you can be claimed as a dependent by another taxpayer determine whether you must file a U.S. federal income tax return. To determine if you meet the gross income requirement for filing purposes, you must include all income you receive from foreign sources as well as your U.S. income. This is true even if:

Self-employed persons.   You must file a U.S. income tax return if you had $400 or more of net earnings from self-employment, regardless of your age. Net earnings from self-employment include income earned both in a foreign country and in the United States.

  You must pay self-employment tax on your self-employment income even if it is earned in a foreign country and is excludable as foreign earned income in figuring your income tax.

Foreign bank and financial accounts.   If you had any financial interest in, or signature or other authority over a bank account, securities account, or other financial account in a foreign country at any time during the tax year, you may have to complete Treasury Department Form TD F 90-22.1, Report of Foreign Bank and Financial Accounts, and file it with the Department of the Treasury at the address listed on the form. You need not file this form if the combined assets in the account(s) are $10,000 or less during the entire year, or if the assets are with a U.S. military banking facility operated by a U.S. financial institution.

  You can get Form TD F 90-22.1 from the offices listed at the end of this publication or through the IRS website at www.irs.gov.

Estate and gift taxes.   Under certain conditions, you may have to file a federal estate or gift tax return. For more information, see Publication 950, Introduction to Estate and Gift Taxes.

You can also request additional information by writing to:

When to file.   If your tax year is the calendar year, the due date for filing your income tax return is usually April 15 of the following year.

Extensions of time to file.   You are automatically granted an extension to June 15 to file your return and pay any tax due if you are a U.S. citizen or resident alien and on the regular due date of your return: You must pay interest on any unpaid tax from the regular due date to the date you pay the tax.

  You do not have to file a special form to receive this extension. You must, however, attach a statement to your tax return explaining what situation qualified you for the extension.

  It may benefit you to file for an additional extension of time to file. You may benefit if, on the due date for filing, you have not yet met either the bona fide residence test or the physical presence test, but you expect to qualify after the automatic extension discussed above. To obtain an additional extension, file Form 2350, Application for Extension of Time To File U.S. Income Tax Return, with the Department of the Treasury, Internal Revenue Service Center, Austin, TX 73301-0215, or your local IRS representative or other IRS employee. You must file Form 2350 after the close of your tax year but before the end of the first extension. If an additional extension is granted, it will be to a date after you expect to meet the time requirements for the bona fide residence or the physical presence test.

Where to file.   If any of the following situations apply to you and you do not use an APO or FPO address, you should file your return with the Department of the Treasury, Internal Revenue Service Center, Austin, TX 73301-0215.

  If none of the above situations apply to you or you use an APO or FPO address, see the instructions for your income tax return.

Tax home.   Your tax home is the general area of your main place of business, employment, or post of duty where you are permanently or indefinitely engaged to work. You are not considered to have a tax home in a foreign country for any period during which your abode is in the United States. However, being temporarily present in the United States, or maintaining a dwelling there, does not necessarily mean that your abode is in the United States. For details, see Publication 54.

Foreign country.   A foreign country, for this purpose, means any territory under the sovereignty of a government other than that of the United States, including territorial waters (determined under U.S. laws) and air space. A foreign country also includes the seabed and subsoil of those submarine areas which are adjacent to the territorial waters of the foreign country and over which it has exclusive rights under international law to explore and exploit natural resources. For this purpose, U.S. possessions or territories and the Antarctic region are not foreign countries.

Waiver of time requirements.   You may not have to meet the minimum time requirements for bona fide residence or physical presence if you have to leave the foreign country because war, civil unrest, or similar adverse conditions in the country prevented you from conducting normal business. You must, however, be able to show that you reasonably could have expected to meet the minimum time requirements if the adverse conditions had not occurred.

  A list of countries qualifying for the waiver is published in the Internal Revenue Bulletin (IRB). You can read the IRB on the Internet at www.irs.gov. Or, you can get a copy of the list by writing to:

Travel restrictions.   If you violate U.S. travel restrictions, you will not be treated as being a bona fide resident of, or physically present in, a foreign country for any day during which you are present in a country in violation of the restrictions. (These restrictions generally prohibit U.S. citizens and residents from engaging in transactions related to travel to, from, or within certain countries.) Also, income that you earn from sources within such a country for services performed during a period of travel restrictions does not qualify as foreign earned income. Housing expenses that you incur within that country (or outside that country for housing your spouse or dependents) while you are in violation of travel restrictions cannot be included in figuring your foreign housing amount.

  These travel restrictions currently apply only to Cuba. However, if you performed services at the U.S. Naval Base at Guantanamo Bay, these travel restrictions do not apply.

If your tax home is in a foreign country and you meet either the bona fide residence test or the physical presence test, you can choose to exclude from gross income a limited amount of your foreign earned income. Your income must be for services performed in a foreign country during your period of foreign residence or presence, whichever applies. You cannot, however, exclude the pay you receive as an employee of the U.S. Government or its agencies.

If your tax home is in a foreign country and you meet either the bona fide residence test or the physical presence test, you may be able to claim an exclusion or a deduction from gross income for a housing amount.

Your housing amount is the excess, if any, of your allowable housing expenses for the year over a base amount. The amount of allowable housing expenses is limited.

Allowable housing expenses are the reasonable expenses (such as rent, utilities other than telephone charges, and real and personal property insurance) paid or incurred during the year by you, or on your behalf, for your foreign housing and that of your spouse and dependents if they lived with you. You can include the rental value of housing provided by your employer in return for your services. You can also include the allowable housing expenses of a second foreign household for your spouse and dependents if they did not live with you because of dangerous, unhealthy, or otherwise adverse living conditions at your tax home. Allowable housing expenses do not include the cost of home purchase or other capital items, wages of domestic servants, or deductible interest and taxes.

Your allowable housing expenses are limited to a percentage of the maximum foreign earned income exclusion amount (discussed earlier under Amount excludable), figured on a daily basis, times the number of days during the year that you meet the bona fide residence test or the physical presence test. The percentage may vary depending on the foreign country where your tax home is located. For more information, see the Instructions for Form 2555.

The base amount is 16% of the maximum foreign earned income exclusion amount, figured on a daily basis, times the number of days during the year that you meet the bona fide residence test or the physical presence test. For 2008, this amount is $38.30 per day ($14,016 per year).

You figure the limit on housing expenses and the base amount on Form 2555.

You make separate choices to exclude foreign earned income and/or to exclude or deduct your foreign housing amount. If you choose to take both the foreign housing exclusion and the foreign earned income exclusion, you must figure your foreign housing exclusion first. Your foreign earned income exclusion is then limited to the smaller of (a) your annual exclusion limit or (b) the excess of your foreign earned income over your foreign housing exclusion.

Once you choose to exclude your foreign earned income or housing amount, that choice remains in effect for that year and all future years unless you revoke it. You can revoke your choice for any year. However, if you revoke your choice for a year, you cannot claim the exclusion again for your next 5 years without the approval of the IRS. For more information on revoking the exclusion, see chapter 4 of Publication 54.

If you claim the foreign earned income exclusion, the housing exclusion, or both, you must figure the tax on your nonexcluded income using the tax rates that would have applied had you not claimed the exclusions. See the instructions for Form 1040 and complete the Foreign Earned Income Tax Worksheet. When figuring your alternative minimum tax on Form 6251, use the Foreign Earned Income Tax Worksheet in the instructions for Form 6251.

If as a condition of employment you are required to live in a camp in a foreign country that is provided by or for your employer, you can exclude the value of any meals and lodging furnished to you, your spouse, and your dependents. For this exclusion, a camp is lodging that is:

Withholding tax.   You may be able to have your employer discontinue withholding income tax from all or a part of your wages. You can do this if you expect to qualify for the income exclusions under either the bona fide residence test or the physical presence test. See Publication 54 for information.

Withholding from pension payments.   U.S. payers of benefits from employer deferred compensation plans (such as employer pension, annuity, or profit-sharing plans), individual retirement plans, and commercial annuities generally must withhold income tax from the payments or distributions. Withholding will apply unless you choose exemption from withholding. You cannot choose exemption unless you provide the payer of the benefits with a residence address in the United States or a U.S. possession or unless you certify to the payer that you are not a U.S. citizen or resident alien or someone who left the United States to avoid tax.

  For rules that apply to nonperiodic distributions from qualified employer plans and tax-sheltered annuity plans, get Publication 575, Pension and Annuity Income.

Estimated tax.   Because foreign employers generally do not withhold U.S. tax from your wages, you may have to pay estimated tax if you are working abroad for a foreign employer. Your estimated tax is the total of your estimated income tax and self-employment tax for the year minus your expected withholding for the year.

  When you estimate your gross income, do not include the income that you expect to exclude. You can subtract from income your estimated housing deduction in figuring your estimated tax liability. However, if the actual exclusion or deduction is less than you expected, you may be subject to a penalty on the underpayment.

If you qualify for the foreign earned income or housing exclusions, see Publication 505 to estimate your tax liability.   Use Form 1040-ES, Estimated Tax for Individuals, to estimate your tax. The requirements for filing and paying estimated tax are generally the same as those you would follow if you were in the United States.

Tax credit.   If you choose to claim a credit for foreign taxes, you generally must complete Form 1116, Foreign Tax Credit (Individual, Estate, or Trust), and attach it to your U.S. income tax return. Do not include the foreign taxes paid or accrued as withheld income taxes on Form 1040.

Limit.   Your credit cannot be more than the part of your U.S. income tax liability based on your taxable income from sources outside the United States. So, if you have no U.S. income tax liability, or if all your foreign income is excludable, you will not be able to claim a foreign tax credit.

  If the foreign taxes you paid or incurred during the year are more than the limit on your credit for the current year, you can carry back the unused foreign taxes as credits to the previous year and then carry forward any remaining unused foreign taxes to the next 10 years.

You will not be subject to this limit and may be able to claim the credit without using Form 1116 if the following requirements are met. If you make this election, you cannot carry back or carry over any unused foreign tax to or from this year.

Foreign taxes paid on excluded income.   You cannot claim a credit for foreign taxes paid on amounts excluded from gross income under the foreign earned income exclusion or the housing amount exclusion, discussed earlier.

Deduction.   If you choose to deduct all foreign income taxes on your U.S. income tax return, itemize the deduction on Schedule A (Form 1040). You cannot deduct foreign taxes paid on income you exclude from your U.S. income tax return.

More information.   The foreign tax credit and deduction, their limits, and the carryback and carryover provisions are discussed in detail in Publication 514.

Contacting your Taxpayer Advocate.   The Taxpayer Advocate Service (TAS) is an independent organization within the IRS whose employees assist taxpayers who are experiencing economic harm, who are seeking help in resolving tax problems that have not been resolved through normal channels, or who believe that an IRS system or procedure is not working as it should.

  If you live outside of the United States, you can call the Taxpayer Advocate at (787) 622-8940 in English or (787) 622-8930 in Spanish. You can contact the Taxpayer Advocate at:

Free tax services.   To find out what services are available, get Publication 910, IRS Guide to Free Tax Services. It contains lists of free tax information sources, including publications, services, and free tax education and assistance programs.