IRS rejected E filed tax with foreign address; wondering about reasons

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Pranjjal
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Joined: Fri Aug 10, 2012 2:10 am

IRS rejected E filed tax with foreign address; wondering about reasons

Post by Pranjjal »

Hi Tax experts,

Need desperate help from tax gurus here to figure out what could have been gone wrong on various points for rejection of federal return. Need to re-evaluate if I filed it correct with the best of my knowledge before paper filing it. Please share your expert views.

First of all I E-filed our 2017 tax return through H&R block software with foreign address. There is no rejection code but message
"There's a Processing Issue with Your E-filed Return. Unfortunately, your 2017 return couldn’t be e-filed."

Now background about this yr's tax filing.

We're part year resident of US for the year 2017 although qualifying for "resident alien" status by meeting substantial presence test.
Have foreign tax home in 2 countries India and Japan with principal tax home country Japan.

1. Foreign Earned Income Exclusion
I think I can claim "Foreign Earned Income Exclusion" as I meet the physical presence test in a foreign countries 330 full days during a period of 12 consecutive months in the yr 2017 & 18. Can I claim if I'm "US resident alien" by meeting substantial presence test?

2. IRS: 330-day physical presence test in foreign countries for Foreign Earned Income Exclusion and international waters
Question about line 18 on form 2555: If you traveled abroad during the 12- month period(365 days) of physical presence test add information in columns. Exclude travel between foreign countries that didn't involve travel on or over international waters, or in or over the United States, for 24 hours or more. If you have no travel to report during the period, enter "Physically present in a foreign country or countries for the entire 12- month period.

Now we traveled from INDIA to JAPAN, from JAPAN to US(days present 7), from JAPAN to AUSTRALIA(days present 15), from JAPAN to INDIA(days present 18)and from JAPAN to IRELAND(days present 8)and stayed for few days in each country during these 365 days. I guess our stay in all countries foreign land except US(only 5 business days) will count in 330 days presence test. Should I show these travel periods. How should I calculate?

As far as I understood the basic rule is:
One can count each FULL day in a foreign country (land or terrestrial waters) as a foreign day, where FULL means "from midnight to midnight"; international waters do not count as physical presence in a foreign country. I'm going crazy trying to understand how to consider time spent on/over international waters by flying with regards to the physical presence test to qualify for Foreign Earned Income exclusion.


3. Moving expenses
I'm claiming moving expenses deduction for AGI as well (Employer didn't reimburse it).

4. Foreign Taxable interest and credit on foreign taxes paid on interest
I've also added Foreign Taxable interest amount and taken credit on foreign taxes paid on interest.

5. Expected to get huge refund amount(federal and state) and added US bank account for direct deposit
If the amount is too big can IRS reject e-filing and ask to paper file it?

6. Do I need to attach any document to show foreign salary income like W2s?

Except these there are other usual forms and schedules too. No error in personal information. Do you see any problem in what I'm claiming, Am I correct or am I misinterpreting the rules? Confused due to rejection from IRS and no reason described. Please help.
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