For Americans, a remote job abroad comes with a quiet tax break — but only if you can count to 330.
A rare US tax break, earned by days
The United States taxes its citizens on their worldwide income, wherever they live. The Foreign Earned Income Exclusion (FEIE) is one of the few escape hatches: it lets a qualifying person keep a slice of foreign wages or self-employment income out of the US tax base. For the 2025 tax year the maximum is $130,000 per person — up from $126,500 in 2024, and rising to $132,900 in 2026 — and the figure is adjusted annually for inflation (IRS).
To claim it you need three things at once, per the IRS: foreign earned income, a tax home in a foreign country, and either status as a bona fide resident of a foreign country for an entire tax year, or 330 full days of physical presence abroad (IRS). For people who move around — contractors, remote employees, perpetual travellers — the bona fide residence route is often out of reach, because it asks for an uninterrupted home abroad across a whole tax year. That leaves the physical presence test, and the physical presence test is arithmetic.
What the physical presence test actually counts
The rule: you must be physically present in a foreign country or countries for 330 full days during any period of 12 consecutive months (IRS). Three phrases in that sentence do most of the work.
"Full days." A full day is "a period of 24 consecutive hours, beginning and ending at midnight," and the entire 24 hours must be spent in a foreign country to count (IRS). The 2025 Form 2555 instructions say it the same way: "A full day means the 24-hour period that starts at midnight" (IRS). The day you fly out of the US, and the day you fly back, are usually not full days abroad.
"Foreign country." Time over international waters does not count. The IRS is explicit: "the time you spend on, or over international waters does not count as time in a foreign country" (IRS). A long-haul flight or a cruise between two countries can quietly burn days you assumed were safe.
"Any period of 12 consecutive months." The window does not have to be the calendar year. It "can begin with any day of the month," and you may "choose the 12-month period that gives you the greatest exclusion" (IRS). The 330 days need not be consecutive either — you can leave and return, as long as the days abroad add up inside one rolling 12-month frame.
That last point is the one most people get wrong. The test is a sliding window, not a tidy January-to-December tally. The clock moves with you — structurally the same idea as the Schengen Area's rolling 180-day window, even though the two regimes have nothing else in common.
The 35-day margin, and why it is thinner than it looks
A 12-month period holds 365 days. Subtract 330 and you are left with 35 days that can be spent in the United States — or over the ocean, or otherwise not in a foreign country — across an entire year. That is the whole budget: a fortnight home for the holidays, a wedding, a work trip to head office, and the margin is gone.
The threshold is also hard-edged. Fall short of 330 full days in your chosen window and you simply do not meet the physical presence test for that window — there is no partial credit for 329. When you qualify for only part of a tax year, the maximum is prorated by your qualifying days. The IRS gives the formula directly: someone with 140 qualifying days in 2025 has a maximum exclusion of (140 ÷ 365) × $130,000 = $49,863 (IRS). Every qualifying day, in other words, is worth real money.
Who can use it, and what it covers
The physical presence test is open to both US citizens and US resident aliens with a foreign tax home (IRS). The bona fide residence alternative is narrower — generally available to US citizens, and to resident aliens who are nationals of a country with a US income-tax treaty. Either way the exclusion is not automatic: you elect it by filing Form 2555 with your return (IRS). And it reaches only earned income — wages, salary, professional and self-employment fees — not dividends, interest, capital gains, or a pension.
One caution worth stating plainly: US tax rules are detailed and they change. The foreign housing exclusion, self-employment tax, and state filing all interact with the FEIE in ways a single article cannot cover. Treat the figures here as the current federal numbers and confirm your own case with the IRS or a cross-border tax professional.
Why the count is the whole game
Strip away the jargon and the FEIE rewards one thing: an exact record of which days you spent in which country, inside the right twelve-month window. Reconstruct it from memory at filing time and you are guessing at a number that decides thousands of dollars — and if the IRS asks, the burden of proving where you were falls on you. The mirror image — when the US begins taxing a foreigner for days spent inside the country — runs on the same kind of day-count (the Substantial Presence Test).
This is the quiet job Countly does. It counts your days in each country automatically, on your phone, and keeps a private, contemporaneous record of every border crossing — so when a 12-month window has to add up to 330, you are reading a number, not reconstructing one.
This article is general information, not legal or tax advice. Rules vary by country and change; check the official IRS guidance and a qualified adviser for your own situation.