{"id":157,"date":"2022-10-25T18:47:34","date_gmt":"2022-10-25T18:47:34","guid":{"rendered":"https:\/\/hrbcomlnp.hrblock.com\/expat-tax-preparation\/resource-center\/?p=157"},"modified":"2025-02-12T14:14:23","modified_gmt":"2025-02-12T18:14:23","slug":"bona-fide-resident-and-the-bona-fide-residence-test","status":"publish","type":"post","link":"https:\/\/hrbcomlnp.hrblock.com\/expat-tax-preparation\/resource-center\/filing\/status\/bona-fide-resident-and-the-bona-fide-residence-test\/","title":{"rendered":"Bona Fide Resident and the Bona Fide Residence Test"},"content":{"rendered":"\n

If you\u2019re an American expat living abroad, you\u2019ve probably heard the term \u201cBona Fide Resident\u201d somewhere along your travels. If you\u2019re confused about what that means, you\u2019re not alone. Many American expatriates have heard of the Bona Fide Residence test, but few really understand who can pass and be considered a Bona Fide Resident of another country, or how that translates to your U.S. taxes each year.<\/p>\n\n\n\n

File on my own<\/a><\/div>
File with an advisor<\/a><\/div><\/div>\n\n\n\n

What is the Bona Fide Residence Test?<\/h2>\n\n\n\n

A question many expats have when they come to our tax experts is \u201cwhat does passing the Bona Fide Residence Test mean? Do I qualify?\u201d<\/p>\n\n\n\n

It\u2019s a good question, because it can be a confusing topic. The Bona Fide Residence Test is one of two ways U.S. taxpayers can qualify for the Foreign Earned Income Exclusion (FEIE)<\/a>. It shouldn\u2019t be confused with the Physical Presence Test<\/a>, the other way to qualify for the exclusion.<\/p>\n\n\n\n

What is the difference between the Bona Fide Residence Test and the Physical Presence Test?<\/h2>\n\n\n\n

To sum it up, the Bona Fide Residency test has to do with your economic and social ties, whereas the Physical Presence Test has to do with the number of days you spend outside the U.S. If you\u2019re unsure of how your days shake out, use the IRS Physical Presence Test calculator<\/a> to help you figure it out.<\/p>\n\n\n\n

To pass the Bona Fide Residence Test you must have more ties to a foreign country and be a resident of that country for an uninterrupted period that includes an entire tax year.<\/p>\n\n\n\n

When you do go back to the U.S., you go with the intention of returning to your foreign country of residence.<\/p>\n\n\n\n

A perk expats like about passing the Bona Fide Residence vs. Physical Presence Test is that those who qualify as a Bona Fide Resident of another country have the luxury of coming back to the states for vacations and holidays.<\/p>\n\n\n\n

If you\u2019re unsure if you can pass either test, there is a handy chart you can use in the IRS\u2019 instructions for Pub.54<\/a><\/strong><\/p>\n\n\n\n

How to qualify as a Bona Fide Resident<\/h2>\n\n\n\n

If you want to qualify as a Bona Fide Resident, there\u2019s good news and bad news. The good news is that the IRS determines status on a case-by-case basis\u2014the IRS Tax Guide for U.S. Citizens and Resident Aliens Abroad (Publication 54)<\/a> says they take into account \u201csuch factors as your intention or the purpose of your trip and the nature and length of your stay abroad.\u201d Having family in your new country is an important distinction (and a big bonus for you), because it helps solidify your ties to the country. The bad news is that because the IRS determines Bona Fide Residency on a case-by-case basis, there isn\u2019t exactly a clear-cut answer to whether or not you\u2019ll pass.<\/p>\n\n\n\n

However, there are a few strict rules that apply that can help you determine if you qualify (see the actual IRS form instructions for more detailed instructions and inclusions\/exclusions):<\/p>\n\n\n\n