Married Filing Jointly FEIE: $132,900 Each

For 2026, each qualifying person on a married filing jointly return has a foreign earned income exclusion cap of $132,900. If both of you qualify for the full year and each has at least that much foreign earned pay, the two caps add to $265,800. Unused room on the lower salary stays on that cap.

Say one of you earns $150,000 in foreign wages and the other earns $80,000, both qualify all year, and neither claims a housing exclusion. The joint return excludes $132,900 plus $80,000, which is $212,900. The $17,100 above the higher earner's cap stays in income, and the $52,900 of unused room on the lower cap stays unused. As of November 2026, those caps are the ones in Revenue Procedure 2025-32 and on the IRS page for figuring the foreign earned income exclusion. Wages and professional fees can enter the cap. Pensions, annuities, and Social Security cannot, which is why the pay test in what counts as foreign earned income comes before the cap. The return that claims it still belongs with the rest of the expat tax and finance filings.

How much can a married couple exclude?

Each qualifying person excludes the lesser of that person's own foreign earned income or $132,900 for 2026. The IRS figuring page states the 2025 version in one sentence: the maximum is the lesser of the foreign income earned or $130,000 per qualifying person, and two married people who both qualify can exclude as much as $260,000 for 2025. The same page sets the 2026 maximum at $132,900 per person. Publication 54 (revised December 2025) says each qualifying spouse can exclude up to that year's maximum, for a total of twice the maximum. Twice $132,900 is $265,800, and that total is available only when each person has enough foreign earned pay to use a full cap.

A part-year qualifying period shrinks that person's cap before you compare it with pay. The IRS method multiplies the year's maximum by qualifying days in the tax year, then divides by 365, or by 366 in a leap year. Its own 2025 example is 140/365 times $130,000, which it states as $49,863. The 2026 Form 2555 treats a full qualifying year as 365 days. A person with 200 qualifying days in 2026 has a maximum of 200/365 times $132,900, which is $72,822 when rounded to the nearest dollar the same way.

Situation	Foreign earned pay	2026 exclusion	Pay left in income
Both qualify all year, and each earns at least the cap	$132,900 or more each	$265,800	Anything above each person's $132,900
Both qualify all year, pay is uneven	$150,000 and $80,000	$132,900 and $80,000	$17,100
Both qualify all year, only one has pay	$200,000 and $0	$132,900	$67,100
One person qualifies for 200 days	$80,000	$72,822	$7,178

Data note: the $132,900, $130,000, and $260,000 figures are IRS amounts as of November 2026. The $150,000, $80,000, $200,000, and 200-day rows are hypothetical pay and day counts run through that formula.

Does each spouse have to qualify?

Yes. Each spouse qualifies alone. Each person needs a tax home in a foreign country and either the bona fide residence test or the physical presence test. Publication 54 lets you meet different tests. One of you can be a bona fide resident for a full tax year while the other counts 330 full days in a 12-month period.

The physical presence test is 330 full days in a foreign country or countries during any 12 months in a row. A full day is the 24-hour period that starts at midnight, and the days can be interrupted by travel. On Form 2555 the 12-month period has to include 365 days, part of which falls in 2026, and it may start or end in another calendar year. How to place that window is covered in how to count 330 days for the exclusion. The bona fide residence test, for a US citizen, is an uninterrupted period that includes an entire tax year. A resident alien uses that test only when the person is a citizen or national of a country that has an income-tax treaty with the United States.

If one of you stays in the United States

A spouse whose abode is in the United States for the year fails the foreign tax-home test for that period, apart from the combat-zone exception in the Form 2555 instructions, so that spouse's pay stays outside the exclusion. A US dwelling does not place your abode in the United States merely because your spouse and dependents use it. Abode still follows family, economic, and personal ties, and a US home can count toward those ties.

• Confirm a foreign tax home for each person who will claim the exclusion.
• Pick the bona fide residence test or the physical presence test for that person. The two choices can differ.
• Count 330 full days, or a residence period that covers an entire tax year, before you put a number on the return.
• Leave US government pay off Form 2555. The instructions say not to file the form for that pay.
• Leave pensions, annuities, and Social Security off the exclusion. They are not foreign earned income.

A nonresident alien spouse who chooses, with a US citizen or resident spouse, to be taxed as a US resident can use the physical presence test if the day count is met. The Form 2555 instructions point to Publication 54 for how to make that choice. The day count is still that person's own.

What if only one spouse earns the pay?

The exclusion follows the person who earned the income. On the uneven salaries in the table, the $52,900 gap between the $80,000 salary and the $132,900 cap stays on that person's line. It stays there when the other spouse still has $17,100 above their own cap.

The one-earner case uses the same rule with a zero. Say one spouse earns $200,000 of foreign wages, the other earns none, and both otherwise qualify for the full year. Figured separately, the exclusion is $132,900 plus $0, so $67,100 remains. Section 911 sets the couple's excludable total at the amount that would apply if the pay were not community income, and the 2026 Instructions for Form 2555 say to figure each spouse separately and add the results. In a community-property state, skip the move that recasts $200,000 as $100,000 on each Form 2555. Write each spouse's own foreign earned income, apply that spouse's cap, and add the two results before you estimate the refund.

How does housing change a joint return?

Figure any foreign housing exclusion before the earned-income exclusion. The IRS figuring page limits the earned-income exclusion to foreign earned income minus the housing exclusion you claim. Housing does not sit on top of a full $132,900 when the salary is not large enough to cover both.

For 2026, Notice 2026-25 sets the base housing amount at 16 percent of $132,900, which is $21,264 for a full qualifying year, or $58.26 a day. The general limit on housing expenses is 30 percent of $132,900, which is $39,870 for a full year. Cities with a higher limit are listed in that notice. If your city is not listed and you have 365 qualifying days, the Form 2555 instructions say to enter $39,870. Count reasonable rent and utilities other than telephone. Leave out the purchase price of a home, meals, and lavish costs.

One household, one base amount

Spouses who share one foreign household and file jointly may figure housing jointly or separately. Figured jointly, either spouse can claim it, and the other does not claim it again. The spouse who claims it can add both spouses' qualifying expenses, stop at the expense limit, and subtract one base housing amount. Figured separately, each spouse subtracts a full base amount. The instructions allow you to allocate every expense to one spouse, or to split them, as long as the same expense is not excluded twice. Splitting one rent across two base amounts of $21,264 is the version that often shrinks the benefit to zero.

Two households follow a distance test. Each spouse claims only their own place when the tax homes are outside a reasonable commute of each other and neither household is within a reasonable commute of the other spouse's tax home. If that test fails, only one spouse claims housing. The housing exclusion is the employee version, paid from employer amounts. The housing deduction is the self-employed version. Either one reduces income tax. Neither reduces self-employment tax.

Does the exclusion cut self-employment tax?

No. On foreign earned self-employment income, the exclusion reduces regular income tax and leaves self-employment tax in place. That is the rule on the IRS foreign earned income exclusion page, and the housing page says the same thing about the housing exclusion and the housing deduction. Two freelance spouses can each claim an exclusion and still each owe self-employment tax on their own net earnings. The way that tax survives the move abroad is laid out in the self-employment tax trap for freelancers abroad.

Gross receipts are not the exclusion. The figuring page starts a self-employed person with foreign earned gross receipts, then the expenses tied to those receipts and the deduction for half of the self-employment tax. Expenses that belong to the excluded slice cannot also be deducted. Each spouse runs that allocation on that spouse's own Form 2555.

Leftover income is taxed with the Foreign Earned Income Tax Worksheet in the Form 1040 instructions, at the rates that would have applied had you not claimed the exclusion. Alternative minimum tax uses the worksheet in the Form 6251 instructions. On the $150,000 and $80,000 example, the $17,100 that remains is taxed on top of the excluded amount. Claiming either exclusion also changes the IRA deduction under Publication 590-A, so check that publication before you contribute.

What do you attach to the joint return?

Each spouse who claims the foreign earned income exclusion, the foreign housing exclusion, or the foreign housing deduction attaches a separate Form 2555. The forms-to-file page and Part VII of the instructions both require that split: figure the exclusion separately, and complete Part VII on each spouse's own form. Attach both forms to Form 1040 or 1040-SR. Mail the return to the Form 2555 address, not the address for your state of residence. Current addresses are on the IRS page for international places to file Form 1040.

A 2026 calendar-year return is generally due April 15, 2027. You get an automatic extension to June 15, 2027 when, on the due date, you live outside the United States and Puerto Rico and your tax home is outside the United States and Puerto Rico. Attach a statement that both conditions are met. The extra two months also cover payment, and interest still runs on tax unpaid by the regular due date. If the day-count or residence test will not be met by that extended date, file Form 2350 with the Austin service center at Department of the Treasury, Internal Revenue Service Center, Austin, TX 73301-0045, before the return is due, and ask for a date after you expect to qualify. The other path is to file on time without the exclusion and amend on Form 1040-X after you qualify. That amended return is generally due within three years after the original filing date or within two years after the tax was paid, whichever is later.

Make the first choice on a timely return, including extensions, or on an amendment of a timely return, aside from the exceptions in Publication 54. The choice then stays on until you revoke it with a statement on the return for the first year you drop it. After a revocation, the next five tax years are closed unless the IRS approves a new choice. A year with no foreign earned income and no foreign housing costs does not force a revocation. Price that five-year gap before you drop the exclusion to take a credit for a single year.

1. List each spouse's foreign earned pay. Keep pensions, Social Security, and US government wages off that list.
2. Write down each spouse's tax home, test, and qualifying days. Prorate a cap that is shorter than 365 days.
3. If you share a household, compare one housing claim minus one $21,264 base with a split across two bases. Keep the larger result, and stay inside the $39,870 general limit unless Notice 2026-25 gives your city a higher one.
4. Subtract that spouse's housing exclusion from that spouse's foreign earned income before you apply the $132,900 cap.
5. Complete a separate Form 2555 for each spouse who is claiming an exclusion or a housing benefit. Add the two results on the joint return.
6. Mail Form 1040 to the Form 2555 address. Pay by April 15, 2027 if you want to stop interest, even when the June 15, 2027 filing extension applies.
7. If the time test is still open, file Form 2350 before the deadline or file without the exclusion and amend.
8. Treat a later revocation as a five-year decision, not as a one-year toggle.

Assign every dollar of foreign earned pay to the spouse who earned it, stop at that spouse's own cap, and attach two Forms 2555 when both of you claim the benefit. Two full salaries can clear as much as $265,800 in 2026. One salary uses one cap, and the blank line on the other form leaves that gap in income.

US citizens and resident aliens who live abroad are still taxed on worldwide income. The exclusion is a claim on a filed return. City housing limits, later law changes, and the facts of a tax home can change the result for the year you file.

Data notes / Sources checked

• Revenue Procedure 2025-32, section 4.39, sets the 2026 exclusion at $132,900.
• Figuring the foreign earned income exclusion states the per-person limit, the 2025 combined $260,000, the part-year formula, and the self-employed allocation.
• Foreign earned income exclusion covers who qualifies, which pay counts, and the self-employment tax rule.
• 2026 Instructions for Form 2555 cover separate forms, community property, one shared household, the five-year revocation, the child tax credit bar, and the April 15, 2027 and June 15, 2027 dates.
• Notice 2026-25 sets the $21,264 base and the $39,870 general housing limit.
• Publication 54 (December 2025) allows different tests and a couple total of twice that year's maximum.
• Section 911 of the Internal Revenue Code sets the couple's exclusion as if community-property pay were not community income.
• Forms to file requires a separate Form 2555 for each qualifying spouse.
• Foreign housing exclusion or deduction confirms those benefits do not reduce self-employment tax.