Planning to work outside the United States? As long as you are an American citizen, all of your worldwide income must be reported to the IRS, no matter where the income was earned.
Income earned outside the United States may be offset, at least in part, by an exclusion for foreign income. That exclusion is set at $78,000 for 2001, and it will escalate to $80,000 in future years. Foreign tax credits also can help to reduce the amount you’ll owe to the IRS, if you pay taxes in a foreign country.
