Taxpayer receives $60,000 foreign income wages and $1000 in dividends and interest. He qualifies for the exclusion of $103,000 of his foreign income. When calculating the MAGI is that before the exclusion of foreign incoime?
Maximum contribution to Roth IRA is defined under §219(b), which stipulates that it cannot exceed the lesser of—
(A) the deductible amount, or
(B) an amount equal to the compensation includible in the individual’s gross income for such taxable year.
Unless part of your client's compensation could not be fully excluded (e.g. because of US workdays or compensation sourced to earlier years for which no excess FEIE could be claimed), your client doesn't have any compensation includible in gross income.
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