Foreign Housing Deduction for Self-Employed

§ 911. Citizens or residents of the United States living abroad(a) Exclusion from gross incomeAt the election of a qualified individual (made separately with respect to paragraphs (1) and (2)), there shall be excluded from the gross income of such individual, and exempt from taxation under this subtitle, for any taxable year—(1) the foreign earned income of such individual, and (2) the housing cost amount of such individual. (b) Foreign earned income(1) DefinitionFor purposes of this section—(A) In generalThe term “foreign earned income” with respect to any individual means the amount received by such individual from sources within a foreign country or countries which constitute earned income attributable to services performed by such individual during the period described in subparagraph (A) or (B) of subsection (d)(1), whichever is applicable. (B) Certain amounts not included in foreign earned incomeThe foreign earned income for an individual shall not include amounts—(i) received as a pension or annuity, (ii) paid by the United States or an agency thereof to an employee of the United States or an agency thereof, (iii) included in gross income by reason of section 402(b) (relating to taxability of beneficiary of nonexempt trust) or section 403(c) (relating to taxability of beneficiary under a nonqualified annuity), or (iv) received after the close of the taxable year following the taxable year in which the services to which the amounts are attributable are performed. (2) Limitation on foreign earned income(A) In generalThe foreign earned income of an individual which may be excluded under subsection (a)(1) for any taxable year shall not exceed the amount of foreign earned income computed on a daily basis at an annual rate equal to the exclusion amount for the calendar year in which such taxable year begins. (B) Attribution to year in which services are performedFor purposes of applying subparagraph (A), amounts received shall be considered received in the taxable year in which the services to which the amounts are attributable are performed. (C) Treatment of community incomeIn applying subparagraph (A) with respect to amounts received from services performed by a husband or wife which are community income under community property laws applicable to such income, the aggregate amount which may be excludable from the gross income of such husband and wife under subsection (a)(1) for any taxable year shall equal the amount which would be so excludable if such amounts did not constitute community income. (D) Exclusion amount(i) In generalThe exclusion amount for any calendar year is $80,000. (ii) Inflation adjustmentIn the case of any taxable year beginning in a calendar year after 2005, the $80,000 amount in clause (i) shall be increased by an amount equal to the product of—(I) such dollar amount, and