Yes. You have to ask for it.
The worst part of what these right-winger Tea Bag elements have done is to politicize everyone else’s benefits in the Federal Tax Code. When Tea Bag people take the mortgage interest deduction, the Child Tax Credit (esp. in places like Utah where the Mormons keep churning them out), or the ridiculous special exemptions for unearned income like stock market capital gains, they act like these provisions of the tax code were put there by the Lord himself.
But when it comes to items for Americans who aren’t exactly like them, they tend to feel some grave injustice is being done. That was the case a few months ago, when I had one of those stupid BBS back-and-forths on the Vanguard Bogle boards about whether Section 36(a) covered people who had foreign earned income.
Apparently, the folks at the IRS read the rule and also concluded that it did. Foreign earned income is included in gross income. Simply the fact that you can exclude it when determining adjusted gross income doesn’t mean that it isn’t part of your income!
Again, I can’t give you tax advice as such, if you are researching the issue over the internet. But, I am simply saying that provisions as Congress enacted them suggest that your foreign earned income should count for the credit. In fact, this seemed to have been well settled until someone remarked, on the net, that they felt TurboTax was incorrectly calculating the credit (because it was showing that yes, you are entitled to it.) TurboTax changed the software program–but it isn’t clear that weren’t right the first time!
Hoofin 