What if my assignment ends early and I don’t qualify for the FEIE?
While the Foreign Earned Income Exclusion can be beneficial, there are also other ways to avoid double taxation. You may be able to apply the Foreign Tax Credit (FTC) to offset taxes paid to other countries. But for countries that have low or no income tax, you may ultimately pay the US taxes on that income.
Can I claim Foreign Tax Credit for social taxes paid to another country?
You may be able to claim a foreign tax credit for foreign taxes paid to a foreign country or for a U.S. possession. The employee portion of foreign social security taxes is generally considered a foreign income tax available for the foreign tax credit. However, social security taxes are not creditable if paid to a country with which the United States has a totalization agreement (Social Tax Agreement).