Tax Home in a Foreign Country Lawyers

What Is a Tax Home?

Your tax home is your main place of: 

• Business
• Employment
• Post of duty

Basically your tax home is where you are permanently and indefinitely working as an employee or self-employed individual. This does not mean that it is your residence or domicile for tax purposes.

What if I Do not Have a ¿Regular¿ Place of Business?

If you do not have a regular or main place of business because of the nature of your work, your tax home could be the place where you regularly live. If you have neither a regular or main place of business nor a place where you regularly live, you are considered an itinerant, and your tax home is wherever you work.

When Am I Not Considered as Having a Tax Home in a Foreign Country?

You are not considered to have a tax home in a foreign country for any period in which your abode is in the United States. However, your abode is not necessarily in the United States while you are temporarily in the United States. Your abode is also not necessarily in the United States merely because you maintain a dwelling in the United States, whether or not your spouse or dependents use the dwelling.

What Is an Abode?

An abode can be defined as your home, habitation, residence, domicile, or dwelling place. However, it can never mean your principle place of business. Abode has a domestic rather than a business meaning and does not mean the same ¿tax home.¿ Your economic, family, and personal ties often determine where your abode is.

Temporary or Indefinite Assignment

The location of your tax home often depends on whether you are there temporarily or indefinitely: 

• Temporary ¿ If you¿re temporarily absent from your U.S. tax home, then you may be able to deduct your expenses away from home. You probably wouldn¿t qualify for foreign earned income exclusion.
• Indefinite ¿ If your new work assignment is for an indefinite period, then the place you work becomes your new tax home. If the new tax home is in a foreign country and meets the other requirements, you might be eligible for foreign income tax exclusion.

What Can You Do if You Have Problems Figuring Out Your Tax Home?

International Tax is an extremely complex area of the law. You may want to consult an international tax lawyer who has an extensive knowledge of tax homes and other international tax issues. An experienced tax lawyer would be able to explain your problems to you and help resolve them.