Louise Works in a Foreign Branch of Her Employer's Business

question 39

Multiple Choice

Louise works in a foreign branch of her employer's business. She earned $5,000 per month throughout the relevant period. Which of the following is correct:

• A) If Louise worked in the foreign branch from May 1, 2017 until October 31, 2018, she may exclude $40,000 from gross income in 2017 and exclude $50,000 in 2018.
• B) If Louise worked in the foreign branch from May 1, 2017 until October 31, 2018, she cannot exclude anything from gross income because she was not present in the country for 330 days in either year.
• C) If Louise began work in the foreign country on May 1, 2017, she must work through November 30, 2018 in order to exclude $55,000 from gross income in 2018 but none in 2017.
• D) Louise will not be allowed to exclude any foreign earned income because she made less than $103,900.
• E) None of these.

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Definitions:

Standard of Care

The degree of attention, caution, and prudence that a reasonable person in a particular situation would reasonably be expected to exercise.

Auditing Standards

The set of guidelines and criteria established for auditors to follow when conducting financial audits.

Good Faith

An honest intention to act without taking an unfair advantage over another party usually within a contractual context.

Suspicious Financial Dealings

Transactions that raise concerns about legality, often indicating potential fraud or money laundering.