Problem:
Jeremy, an American citizen, earned $200,000 during 2011 while employed in Saudi Arabia. Jeremy is entitled to the maximum foreign-earned income exclusion. Jeremy also incurred $40,000 of deductible expenses attributed to the foreign-earned income. Jeremy may deduct how much in expenses?
- $-0-
- $18,580
- $21,420
- $40,000
Note: Please explain comprehensively and give step by step solution.