Bona Fide Foreign Resident


DEFINITION of 'Bona Fide Foreign Resident'

Any resident of a foreign country that meets the IRS criteria for the bona fide residence test. This test classifies any person that lives in any foreign country for the entire tax year as a Bona Fide Foreign Resident. Anyone falling into this category is eligible for the foreign earned income exclusion. Bona Fide Foreign Residents must be either U.S. citizens living abroad or resident aliens of a country with which the U.S. has a valid tax treaty.

BREAKING DOWN 'Bona Fide Foreign Resident'

Bona Fide Foreign Residence status is not automatically accorded merely by living in a foreign country for one year. A clearly-defined permanent residence must be established in the foreign country before this status can be accorded. However, the taxpayer's domicile, or permanent home must be in the U.S., to which the taxpayer eventually intends to return.

  1. Physical-Presence Test

    Similar to the bona fide foreign residence test, the physical-presence ...
  2. Foreign Housing Exclusion And Deduction

    An allowance for taxpayers who live and work in a foreign country ...
  3. Alien

    Any person who is not a citizen of the country in which he or ...
  4. Resident Alien

    A foreigner who is a permanent resident of the country in which ...
  5. Nonresident Alien

    A non-U.S. citizen who doesn't pass the green card test or the ...
  6. Taxes

    An involuntary fee levied on corporations or individuals that ...
Related Articles
  1. Retirement

    What Does It Cost to Retire in Panama?

    Learn how much it costs to retire comfortably in Panama, and why it has become one of the most popular retirement destinations in the world.
  2. Retirement

    6 Reasons Why Americans Retire in Panama

    Understand why more and more Americans are retiring to Latin America. Learn why Panama is a popular retirement destination for Americans.
  3. Taxes

    Tax Breaks For Volunteering

    Your volunteer ventures could earn you some welcome tax deductions, along with the satisfaction of helping others.
  4. Taxes

    Six Ways Your Tax Preparer Knows You’re Lying

    Cheating on your taxes is asking for trouble. You might get away with it, but you’re playing with fire and likely to get burned.
  5. Retirement

    Read This Before You Retire in the Philippines

    The Philippines has a warm climate, a low cost of living and plenty of people who speak English. What to do next if you think you want to retire there.
  6. Savings

    How Americans Can Open a Bank Account In Thailand

    Have your paperwork in order and be sure to shop around.
  7. Taxes

    The Purpose Of The W-9 Form

    The W-9 form provides key data your clients need if you're an independent contractor. Just be sure you're not really an employee who should fill out a W-4.
  8. Taxes

    5 States Without Sales Tax

    Learn about the five states that do not charge sales taxes and about other taxes the states levy instead in order to generate revenue.
  9. Taxes

    10 Money-Saving Year-End Tax Tips

    Getting organized well before the deadline will curb your frustration and your tax liability.
  10. Taxes

    End-of-the-Year Checklist to Save on Income Taxes

    From grouping related expenses to factoring in the alternative minimum tax, here are some things you need to keep in mind when doing tax planning.
  1. I am a non-U.S. citizen living outside the U.S. and trading stocks through a U.S. ...

    The tax implications for a foreign investor will depend on whether that person is classified as a resident alien or a non-resident ... Read Full Answer >>
  2. As a temporary resident of the US, can I withdraw funds from my Traditional IRA without ...

    Should you decide to invest in a Traditional IRA and receive a tax deduction for your contribution, the amounts that you ... Read Full Answer >>
  3. When am I not required to submit a social security number on my tax return?

    When filing your tax return, you are generally required to include the social security numbers of yourself and the individuals ... Read Full Answer >>
  4. How can I tell if I'm eligible for an EITC?

    According to the IRS, over 22 million taxpayers received $41.4 billion dollars in earned income tax credit (EITC) for tax ... Read Full Answer >>
  5. What is an alienation clause?

    Whether used in reference to insurance policies, mortgages or commercial loans, an alienation clause stipulates that should ... Read Full Answer >>
  6. Do tax brackets include Social Security?

    A portion of your Social Security benefits may be subject to federal taxation using tax brackets. Your tax bracket is determined ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Take A Bath

    A slang term referring to the situation of an investor who has experienced a large loss from an investment or speculative ...
  2. Black Friday

    1. A day of stock market catastrophe. Originally, September 24, 1869, was deemed Black Friday. The crash was sparked by gold ...
  3. Turkey

    Slang for an investment that yields disappointing results or turns out worse than expected. Failed business deals, securities ...
  4. Barefoot Pilgrim

    A slang term for an unsophisticated investor who loses all of his or her wealth by trading equities in the stock market. ...
  5. Quick Ratio

    The quick ratio is an indicator of a company’s short-term liquidity. The quick ratio measures a company’s ability to meet ...
  6. Black Tuesday

    October 29, 1929, when the DJIA fell 12% - one of the largest one-day drops in stock market history. More than 16 million ...
Trading Center