The final 2017 Tax Court Case in which the Foreign Earned Income Exclusion was an issue was Redfield v. IRS, T.C. Memo 2017-71. Unfortunately, Redfield is more about paying attention to deadlines and administrative limits to claiming tax benefits in general (as opposed to the Foreign Earned Income Exclusion in particular). In short, the Tax Court agreed with the IRS: the taxpayer was not entitled to the Foreign Earned Income Exclusion for 2010 because he failed to make an election for the Foreign Earned Income Exclusion within the amount of time stated by Treasury Regulation 1.911-7(a)(2). In this case, the relevant portions of that Regulation are:
(i) In general.--In order to make a valid election under this paragraph
(a), the election must be made:
(A) With an income tax return that is timely filed (including any extensions of time to file),
(B) With a later return filed within the period prescribed by section 6511(a) amending the foregoing timely filed return, [or]
(C) With an original income tax return that is filed within one year after the due date of the return (determined without regard to any extension of time to file) * * *
The parties agree that petitioner did not make a timely election under any of these methods. He did not file his 2010 Federal income tax return by October 15, 2011, the extended due date. The return that he filed in October 2014 did not amend a “timely filed return.” And that delinquent return was not “filed within one year after the due date” of his 2010 return.
The taxpayer thus lost due to the timing of his election in Redfield. The full opinion is available here: https://scholar.google.com/scholar_case?case=1461363916649994071&q=T.C.+Memo+2017-71&hl=en&as_sdt=6,47.
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