US: IRS announces foreign income exclusion eligibility waiver countries for 2024

07 March, 2025

The US Internal Revenue Service (IRS) has released Revenue Procedure 2025-17, set to be published in Internal Revenue Bulletin 2025-13 on 14 March 2025.

This revenue procedure provides information to any individual who failed to meet the eligibility requirements of section 911 of the Internal Revenue Code (Code) for 2024 because of adverse conditions in a foreign country.

The Revenue Procedure addresses the foreign earned income exclusion for individuals who couldn’t meet eligibility requirements due to adverse conditions in a foreign country. Section 911 allows a “qualified individual,” as defined in section 911, to elect to exclude from gross income the foreign earned income and to exclude or deduct the housing cost amount of such individual.

According to the IRS, an individual who meets certain requirements, may qualify for the foreign earned income exclusion, the foreign housing exclusion, and/or the foreign housing deduction. To claim these benefits, the individual must have foreign earned income, and their tax home must be in a foreign country.

They must also be one of the following:

A US citizen who is a bona fide resident of a foreign country or countries for an uninterrupted period that includes an entire tax year,
A US resident alien who is a citizen or national of a country with which the United States has an income tax treaty in effect and who is a bona fide resident of a foreign country or countries for an uninterrupted period that includes an entire tax year, or
A US citizen or a US resident alien who is physically present in a foreign country or countries for at least 330 full days during any period of 12 consecutive months.

In this regard, an exception allows an individual to be treated as a qualified individual for a period when they were a bona fide resident of or present in a foreign country if they left due to adverse conditions and can show they would have met the requirements had they not needed to leave.

For the 2024 tax year, the following countries and corresponding departure dates are eligible for this exception: