The IRS issues the 2022 foreign housing cost exclusions. A U.S. citizen or U.S. resident alien living abroad can elect to exclude the foreign earned income and housing cost amount from gross income (subject to limitations). The housing cost exclusion is calculated based on the number of days physically present in the foreign location. In addition, the IRS allows a higher amount for those living in certain high-cost locations. Without adjustment, the applicable limit for the 2022 tax year is $33,600. The IRS issued the table of 2022 adjusted limitations on housing expenses and stated that qualified taxpayers may elect to apply 2022 limitations to tax years beginning in 2021. (Notice 2022-10)
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