Form 673 – Statement for Claiming Exemption from Withholding on Foreign Earned Income
Last reviewed: 2025-10-26
Use the IRS Form 673 – Exemption from Withholding Tax Form Calculator IRS Form 673 – Exemption from Withholding as a stand alone tax form calculator to quickly calculate specific amounts for your 2026 673 state tax return. Alternatively, you can use one of our Combined Federal and State Tax Estimators to quickly calculate your salary, tax, and take-home pay.
Form 673 allows U.S. citizens working abroad to claim an exemption from federal income tax withholding on foreign earned income and qualified housing amounts. By submitting this form to their employer, eligible taxpayers avoid unnecessary withholding if they intend to file Form 2555 and meet either the bona fide residence or physical presence test under IRC §911.
Key details when completing Form 673:
- Eligibility: U.S. citizen or resident alien with qualifying foreign earned income who expects to meet either:
- Bona fide residence test: Living in a foreign country for an uninterrupted period including an entire tax year.
- Physical presence test: Present in foreign countries at least 330 full days in any 12-month period.
- Form 2555 required: Filing Form 2555 with your tax return is necessary to support your exemption claim.
- Income cap: The maximum foreign earned income exclusion is adjusted annually (e.g., $126,500 for tax year 2024).
| Part I Qualification Information for Foreign Earned Income Exclusion | |||
| I expect to qualify for the foreign earned income exclusion under either the bona fide residence or physical presence test for or other tax and | |||
| Please check applicable box: | |||
| I am a citizen of the United States. I have been a bona fide resident of and my tax home has been (foreign country or countries) for an uninterrupted period which includes an entire tax year that , . | |||
| I expect to remain a bona fide resident and retain my tax home in a foreign country (or countries) until the end of the tax year for which this statement is made. Or, if not that period, from the date of this statement , . | |||
| I have not submitted a statement to the authorities of any foreign country named above that I am not a resident of that country. Or, if I made such a statement, the authorities of that country thereafter made a determination to the effect that I am a resident of that country. | |||
| Based on the facts in my case, I have good reason to believe that for this period of foreign residence I will satisfy the tax home and the bona fide foreign resident requirements prescribed by section 911(d)(1)(A) of the Internal Revenue Code and qualify for the exclusion Code section 911(a) allows. | |||
| I am a citizen of the United States. Except for occasional absences that will not disqualify me for the benefit of section 911(a) of the Internal Revenue Code, I expect to be present in and maintain my tax home (foreign country or countries) for a 12-month period that includes the entire tax . Or, if not the entire year, for the part of the tax year beginning , , and , | |||
| Based on the facts in my case, I have good reason to believe that for this period of presence in a foreign country or countries, I will satisfy the tax home and the 330 full-day requirements within a 12-month period under section 911(d)(1)(B). | |||
| Part II Estimated Housing Cost Amount for Foreign Housing Exclusion (see instructions) | |||
| 1 | 1 | ||
| 2 | 2 | ||
| 3 | 3 | ||
| 4 | 4 | ||
| 5 | 5 | ||
| 6 | 6 | ||
| 7 | 7 | ||
| 8 | 8 | ||
| 9 | 9 | ||
| Part III Certification | |||
| Under penalties of perjury, I declare that I have examined the information on this form and to the best of my knowledge and belief it is true, correct, and complete. I further certify under penalties of perjury that: • The estimated housing cost amount entered in Part II, plus the amount reported on any other statements outstanding with other employers, is not more than my total estimated housing cost amount. • If I become disqualified for the exclusions, I will immediately notify my employer and advise what part, if any, of the period for which I am qualified. I understand that any exemption from income tax withholding permitted by reason of furnishing this statement is not a determination by the Internal Revenue Service that any amount paid to me for any services performed during the tax year is excludable from gross income under the provisions of Code section 911(a). | |||
Form 673 must be submitted directly to your employer—not to the IRS. Once accepted, your employer can stop withholding federal income tax on the qualified income and housing amount. Social Security and Medicare tax are still withheld unless a totalization agreement applies.
Last reviewed: 2025-10-26: If you believe this form requires an update, please contact us.
Keep a copy of Form 673 and supporting documentation. If your eligibility changes during the year (e.g., you no longer meet the residence or presence test), notify your employer immediately to resume withholding. Late filing or false certification may result in penalties and additional tax liability at year-end.
Frequently Asked Questions
Can I estimate the General Business Credit?
Start with Form 3800 and then reflect the credit here.
How much would a 401(k) contribution change my net?
Model it with the 401(k) Calculator then rerun this page with your pre-tax amount.
Considering an IRS Offer in Compromise?
Read through Form 656-B to understand eligibility and steps.
What does FICA include?
FICA includes Social Security and Medicare payroll taxes withheld from employee wages.
Important Notes
All calculations are estimates for guidance only. Always review your return and consider professional advice when submitting official filings.