Kind of an aside, but it's sometimes not even worth doing the shortcut, again unless you're in a very low-tax country. I am eligible for the foreign earned inco

Kind of an aside, but it's sometimes not even worth doing the shortcut, again unless you're in a very low-tax country. I am eligible for the foreign earned income exclusion but purposely don't take it, and instead take the foreign tax credit, because excluded income is not eligible for IRA contributions [1]. It's entirely excluded, so doesn't count as earned income, and since you can't contribute more to an IRA than you have in earned income for the year, if you end up excluding all your income you have no basis for a contribution. But the foreign tax credit doesn't cause the same problem, because it's just a credit against tax owed, not an exclusion of income. [1] http://www.irs.gov/Individuals/International-Taxpayers/Individual-Retirement-Arrangements http://www.irs.gov/Individuals/International-Taxpayers/Indiv...