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Q. Foreign-Earned Income Exclusion. Dillon, a US citizen, resides in Country K for all of 2010. Dillon is married, files a joint return and claims two personal exemptions. The subsequent items pertain to his 2010 activities:Salary and allowances (other than for housing) a $175,000Housing allowance 28,000Employment-related expenses b 7,500Housing costs 30,000Other itemized deductions 4,000Country K income taxes 12,000
A. All of Dillon's salary and allowances are attributable to services performed in Country K.
B. Dillon claims the employment-related expenses as itemized deductions.
Illustrate what is Dillon's net US tax liability for 2010 (assume which Dillon excludes his earned income and housing cost amount)?
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