How can I get Lacerte to include SE income reported on partnership K-1 as foreign earned income for my client who is a bona fide resident in foreign country?

[QueenBee110]

The partnership is a US (California) partnership.  All the services my client provided were while he was living as a bona fide resident in Belize.  I believe that this SE income should qualify for the Foreign earned income exclusion.

[PKCPAMST · Accepted solution]

To qualify for the foreign earned income exclusion under IRC Sec 911, the U.S. taxpayer must have a tax home in a foreign country and who can establish that he/she is a bona fide resident of one or more foreign countries or meets the physical presence test in one or more foreign countries.

1. In Lacerte, go to Screen 31 – Foreign Income Exclusion. In the left navigation panel, select General Information and complete Foreign Address of Taxpayer (if different from Form 1040).
2. Select Section - Bona Fide Residence and enter the beginning date for bona fide residence, and, if applicable, the ending date.
3. In the left navigation panel, select Foreign Wages (even though these are not wages).  In the fifth column - Form 2555 Name or Number, enter 1.
4. Go to Section - For. Allowances, Reimburse., & Other Earned Income.
5. Under Allowable Inc. for Personal Services, go to Partnership name, address, & nature of income (Ctrl-E). The amount you enter here will carry to Form 2555.