Yada Yada / The Off Topic Arena

Review the Foreign Earned Income Exclusion. If you live and work abroad, you may be able to claim the foreign earned income exclusion. If you qualify, you won'tpay tax on up to $100,800 of your wages and other foreign earned income in 2015.

See
https://www.irs.gov/newsroom/reporting-foreign-income-eight-tax-tips-from-the-irs

 

SSA may be subject to taxes, if your total income including SSA is above the minimum allowance

 

The bold was from a cut and paste, not my handy work, likely google highlighting my search terms. Foreign in this context means income earned in another country, not income earned from a foreign entity.

Can I Claim A Foreign Income Tax Exclusion?
You may qualify for a foreign income tax exclusion from a limited amount of foreign earned income. In order to qualify for the exclusion, you must:

• Reside and work outside of the U.S. AND
• Meet either the Physical Presence or Bona Fide Residence Test

What Is the Maximum Amount I Can Exclude From My Foreign Earned Income?
The amount of foreign income that you can exclude is limited to your annual maximum dollar amount limit or actual foreign wages, whichever is less. Since Tax Year 2006, the IRS has adjusted this amount each Tax Year for inflation.

Below are the maximum amounts for foreign income tax exclusion since the 2006 Tax Year:

Tax Year Maximum Amount Foreign Income Exclusion
2018 $104,100

A certain part of SS is taxed

If income is between $25,000 and $34,000, up to 50 percent of your benefits may be subject to tax. For income of more than $34,000, up to 85 percent of your benefits may be considered taxable income.

 

I'll buy that since it makes no difference to me in my current situation.

 

Just taking a wild stab in the dark. But it seems to me the reasoning behind having a policy for "Foreign Earned Income" would be that the assumption is that you are getting taxed on that income by another juristiction and the U.S. would be double taxing you. The US is on a short list (or the only entry on that list) of nations which require citizens to report income no matter where they are at. If the income is being made from outside the U.S. tax juristiction then you still report it but you get an exclusion up to a certain point before they go ahead and double tax you anyways. Probably a simple rule of thumb here is that if you are working with a legit company and you are having to pay taxes (or should be and you are dodging because you know the government isn't going to come after you) to a country other than the U.S. then that income would be exluded?

 

The US and the Philippines have a reciprocal agreement where you don’t pay double taxes.