How to Meet the IRS Physical Presence Test
Learn how U.S. expats can satisfy the IRS physical presence test. This guide clarifies the time-based requirements and procedural steps for a successful tax filing.
The physical presence test is one of two methods the Internal Revenue Service (IRS) provides for U.S. citizens and resident aliens abroad to qualify for the Foreign Earned Income Exclusion (FEIE). This exclusion allows taxpayers to exclude a portion of their foreign-earned income from U.S. income tax. For the 2024 tax year, the maximum exclusion is $126,500. The test is based entirely on the amount of time you spend in a foreign country, making it a straightforward path to the exclusion compared to the Bona Fide Residence Test.
Meeting the 330-Day Requirement
To meet the physical presence test, you must be physically present in a foreign country for at least 330 full days during any consecutive 12-month period. The 330 qualifying days do not need to be continuous and can be broken up by travel. The test is based only on the duration of your stay, so your reasons for being abroad are not considered in the day count.
A “full day” is a continuous 24-hour period that begins at midnight. Days you spend traveling to or from the United States do not count as full days in a foreign country. For example, if you arrive in a foreign country at 10:00 AM, your first full day for this test begins the following day. Time spent over international waters or in U.S. territories like Puerto Rico or Guam does not count toward the 330-day total.
A “foreign country” is any territory under the sovereignty of a government other than the United States, including its airspace and territorial waters but excluding Antarctica and U.S. possessions. You can accumulate your 330 days in one or more foreign countries.
The qualifying 12-month period can be any consecutive 12 months and does not have to align with the calendar year. You can choose any 12-month period that allows you to meet the 330-day requirement, such as from March 10, 2024, to March 9, 2025.
Required Information and Documentation
To substantiate a claim under the physical presence test, you must maintain records that can verify your location on any given day. Important documents include your passport with entry and exit stamps, airline tickets or e-receipts showing flight itineraries, and lodging receipts. These records provide the necessary information to complete IRS Form 2555, Foreign Earned Income.
Form 2555 must be filed with your tax return to claim the exclusion and requires you to demonstrate that you have met the 330-day requirement. When completing the form, you will need to enter the beginning and ending dates of the 12-month period you are using to qualify.
The form also includes a table where you must list all your travel during that 12-month period, including any periods you were in the U.S. or over international waters. For each trip, you must provide the dates of arrival and departure, the number of days spent in the U.S. on business, and whether your income was earned in the U.S.
Claiming the Exclusion on Your Tax Return
The completed Form 2555 must be attached to your annual U.S. income tax return, which is typically Form 1040. The amount of excluded income calculated on Form 2555 is then reported on Schedule 1 of Form 1040.
Many taxpayers working abroad need an extension to file their taxes, often because their 12-month qualifying period is not complete by the standard April 15 tax deadline. U.S. citizens and resident aliens whose tax home is in a foreign country on the regular due date of their return receive an automatic two-month extension to June 15. No special form is required for this initial extension, but you must attach a statement to your return explaining why you qualify.
If you need more time beyond the automatic extension to meet the 330-day requirement, you must file Form 2350, Application for Extension of Time to File U.S. Income Tax Return. This form must be filed before the due date of your return. An approved Form 2350 will extend your filing deadline to 30 days after the date on which you expect to meet the physical presence test. This form only extends the time to file your return, not the time to pay any tax you may owe.