rolling-stone
Apr 24, 2008, 12:48 PM
Hello,
I'm living overseas and have qualified for the FEIE in 2006, 2007, and so far in 2008.
In Q3 2007 my company's corporate professional services contract was terminated and it contained a severence clause for immediate payment of a severence amount. This was subsequently paid in Q1 2008. My questions are these: Is the severence amount considered earned in 2007 or is it reported as income in 2008? The plan is to use the FEIE and Form 2555 instructions say that income paid in the current year but earned in prior year can be excluded if it could have been excluded in the earlier year. How does this work where income and loss are "pass through" and the company uses cash basis accounting?
Want to keep it neat!
Thanks.
R-S
I'm living overseas and have qualified for the FEIE in 2006, 2007, and so far in 2008.
In Q3 2007 my company's corporate professional services contract was terminated and it contained a severence clause for immediate payment of a severence amount. This was subsequently paid in Q1 2008. My questions are these: Is the severence amount considered earned in 2007 or is it reported as income in 2008? The plan is to use the FEIE and Form 2555 instructions say that income paid in the current year but earned in prior year can be excluded if it could have been excluded in the earlier year. How does this work where income and loss are "pass through" and the company uses cash basis accounting?
Want to keep it neat!
Thanks.
R-S