Housing Cost Amount FEIE 2027 Calculator

The Foreign Housing Cost Exclusion under IRC §911(c) supplements the FEIE income exclusion by excluding employer-provided housing costs above a base amount (16% of FEIE — approximately $20,800 in 2027). The IRS publishes annual high-cost city limits via Revenue Procedure. In Hong Kong, the cap is $114,300; Tokyo $93,000; London $79,200 — well above the default $39,000.

How the Housing Cost Amount Calculation Works

Step 1: Sum qualifying housing costs (rent + utilities excluding telephone + insurance + occupancy taxes + furniture rental + repairs + parking). Step 2: Subtract base amount (16% of FEIE, pro-rated by foreign days). Step 3: Cap at city-specific limit (pro-rated by foreign days). The result is excluded from US gross income on Form 2555.

Qualifying vs Non-Qualifying Housing Costs

QUALIFY: rent (or fair rental value of company-provided housing), utilities (not phone), insurance on residence and belongings, occupancy taxes, residential parking, rental of furniture and accessories, repairs. NOT QUALIFY: mortgage interest, mortgage principal, depreciation of owned property, domestic labor (housekeeper, gardener), telephone charges, TV subscriptions, improvements that add value.

High-Cost City Strategy for 2027

Major US-expat hubs with elevated caps: Hong Kong ($114,300), Tokyo ($93,000), Singapore ($82,900), London ($79,200), Geneva ($77,200), Paris ($72,000), Sydney ($59,400), Dubai ($57,400). Cities without elevated caps default to $39,000 (30% of FEIE). Check IRS Revenue Procedure 2024-40 (and successors) annually for your specific city — sub-locations within metros sometimes have separate caps.

Last updated May 2026. Sources: IRC §911 — FEIE and Housing, IRS Form 2555 Instructions