EA is a married, US citizen, who obtained employment as a defense contractor in Afghanistan early last year. EA was initially contracted to work a period of 10 months at his new job.

US Citizens are generally required to file a US Tax Return reporting worldwide income including earnings overseas. However, certain exceptions apply to taxpayers who earn monies abroad and remain abroad for an uninterrupted period of 12 months, whereby approximately $90,000 of earned income can be excluded from taxable income. Furthermore, certain housing allowances are available in certain cases where earned income exceeds the annual limitation for exclusion.

EA renegotiated his contract so that his employment period could exceed the minimum 12 month requirement and pocketed somewhere around $20,000 in income taxes that would have otherwise been charged. Total professional fees approximated $375.