Foreign Earned Income Credit

KaneKungFu123 · #1 09-03-2005, 07:13 PM

For those speculating:

Earned income. This is pay for personal services performed, such as wages, salaries, or professional fees. The list that follows classifies many types of income into three categories. The column headed Variable Income lists income that may fall into either the earned income category, the unearned income category, or partly into both. For more information on earned and unearned income, see Earned and Unearned Income, later.

Unearned Income

Dividends
Interest
Capital gains
Gambling
winnings
Alimony
Social security
Benefits
Pensions
Annuities

KaneKungFu123 · #2 09-09-2005, 12:53 PM

BUMP for MrMon...

that credit is only for money you earn providing "services" in another country.

mmcd · #3 09-09-2005, 02:35 PM

If you file as a profesional, you can treat gambling winnings as earned income. Look at the list you wrote out and compare it to the earned income list. If you are a professional gambler, do you see why gambling winnings moves from one list to the other?

KaneKungFu123 · #4 09-09-2005, 03:23 PM

[ QUOTE ]
If you file as a profesional, you can treat gambling winnings as earned income. Look at the list you wrote out and compare it to the earned income list. If you are a professional gambler, do you see why gambling winnings moves from one list to the other?

[/ QUOTE ]

you are missing the point. this thread is about the foreign earned income credit, which is allows the first 80K of your income to go untaxed... some people have speculated that you can live abroad, file as a pro and recieve this benefit.... you cannot do this... the credit is only for services you provide in another land... the list i show clearly excludes gambling.

mmcd · #5 09-09-2005, 06:16 PM

[ QUOTE ]
[ QUOTE ]
If you file as a profesional, you can treat gambling winnings as earned income. Look at the list you wrote out and compare it to the earned income list. If you are a professional gambler, do you see why gambling winnings moves from one list to the other?

[/ QUOTE ]

you are missing the point. this thread is about the foreign earned income credit, which is allows the first 80K of your income to go untaxed... some people have speculated that you can live abroad, file as a pro and recieve this benefit.... you cannot do this... the credit is only for services you provide in another land... the list i show clearly excludes gambling.

[/ QUOTE ]

You are wrong. I'm not going to bother looking for the authority for this, but you really should before you file. The IRC and tax law more generally isn't all just pigeon-hole type statutes. For the purpose of the Foreign Earned Income tax credit, "earned income" is differentiated from "non-earned income" based on whether it was "passively" earned income such as interest, dividends, capital gains etc. or "actively" earned income such as wages, salary etc. The "services performed" language in the statute is basically asking whether you worked for the money. The gambling winnings of a professional gambler are quite different than the gambling winnings of some guy who won the lottery.

Read 26 U.S.C. § 911 carefully.

KaneKungFu123 · #6 09-09-2005, 06:30 PM

[ QUOTE ]
[ QUOTE ]
[ QUOTE ]
If you file as a profesional, you can treat gambling winnings as earned income. Look at the list you wrote out and compare it to the earned income list. If you are a professional gambler, do you see why gambling winnings moves from one list to the other?

[/ QUOTE ]

you are missing the point. this thread is about the foreign earned income credit, which is allows the first 80K of your income to go untaxed... some people have speculated that you can live abroad, file as a pro and recieve this benefit.... you cannot do this... the credit is only for services you provide in another land... the list i show clearly excludes gambling.

[/ QUOTE ]

You are wrong. I'm not going to bother looking for the authority for this, but you really should before you file. The IRC and tax law more generally isn't all just pigeon-hole type statutes. For the purpose of the Foreign Earned Income tax credit, "earned income" is differentiated from "non-earned income" based on whether it was "passively" earned income such as interest, dividends, capital gains etc. or "actively" earned income such as wages, salary etc. The "services performed" language in the statute is basically asking whether you worked for the money. The gambling winnings of a professional gambler are quite different than the gambling winnings of some guy who won the lottery.

Read 26 U.S.C. § 911 carefully.

[/ QUOTE ]

has there been a thread about this previously?

have you checked this with a CPA???

im really excited if this is true!!!

Holy [censored], Am I excited!!

Need to look into it!!

mmcd · #7 09-09-2005, 07:03 PM

Here's some authority in addition to the statute:

26 CFR § 1.911-3

The treasury reg doesn't conatain any language that would exclude a professional gambler's winnings from foreign earned income. The only portion of the reg that might place a limit on you states that for businesses where income is attributable to both personal services and capital, no more than 30% of the gross income may be treated as earned income. You probably made enough where you'd hit the 80k cap before the 30% even if the limit is applicable which is questionable.

U.S. v. Van Dyke 696 F.2d 957 (1982)

Van Dyke states that it was the intent of Congress that all income not attributable to capital be considered earned income.

KaneKungFu123 · #8 09-09-2005, 07:24 PM

[ QUOTE ]

Read 26 U.S.C. § 911 carefully.

[/ QUOTE ]

i am having a tough time finding this...reading publication 54 right now.

what do those numers stand for? did a yahoo search and came up blanks.

KaneKungFu123 · #9 09-09-2005, 08:16 PM

mmcd,

have you done this personally?

are you required to report your SE earnings (poker) to the authorities of the foriegn country inwhich you reside?

mmcd · #10 09-09-2005, 08:19 PM

[ QUOTE ]
[ QUOTE ]

Read 26 U.S.C. § 911 carefully.

[/ QUOTE ]

i am having a tough time finding this...reading publication 54 right now.

what do those numers stand for? did a yahoo search and came up blanks.

[/ QUOTE ]

It's Title 26 of the United States Code (The Internal Revenue Code) section 911.

The teasury regulations in my other post are in Part 26 of the Code of Federal Regulations, (The CFR numbering corresponds to the stautory numbering) section 1.911-3