My husband works in Kuwait. He started there in October of 2007 and still works there. Last year, he did not meet the requirements for the physical presence test to exclude this income. He did not pay income tax in Kuwait because there is not tax on income in Kuwait.

On our 2007 tax return to the IRS, we reported his foreign income and had to pay the tax. Now that he does satisfy the requirements for the physical presence test, should we file an amended return for 2007.

I don't understand how you can take and exemption or a credit if you never paid tax on the income.