A USCitizen Worked in a Foreign Country for the Period July

question 57

Multiple Choice

A U.S.citizen worked in a foreign country for the period July 1, 2018 through August 1, 2019.Her salary was $10,000 per month.Also, in 2018 she received $5,000 in dividends from foreign corporations (not qualified dividends) .No dividends were received in 2019.Which of the following is correct?

• A)The taxpayer cannot exclude any of the income because she was not present in the foreign country more than 330 days in either 2018 or 2019.
• B)The taxpayer can exclude a portion of the salary from U.S.gross income in 2018 and 2019, and all of the dividend income.
• C)The taxpayer can exclude from U.S.gross income $60,000 salary in 2018, but in 2019 she will exceed the 12- month limitation and, therefore, all of the 2019 compensation must be included in gross income.All of the dividends must be included in 2018 gross income.
• D)The taxpayer must include the dividend income of $5,000 in 2018 gross income, but she can exclude a portion of the compensation income from U.S.gross income in 2018 and 2019.
• E)None of these.

---

Definitions:

Transactions

Financial or physical activities involving the exchange of goods, services, or funds between parties.

Scope of Employment

The range of actions and activities an employee is expected to perform as part of their job.

Plant Nursery

A specialized facility where plants are propagated, grown to a desired age, and then sold for planting elsewhere.

Liable

Legally responsible for one's actions or obligations, often in the context of paying damages or fulfilling a contractual agreement.