SEC. 2. BACKGROUND

1. Section 911(a) of the Code allows a “qualified individual,” as defined in § 911(d)(1), to exclude foreign earned income and housing cost amounts from gross income. Section 911(c)(3) of the Code allows a qualified individual to deduct housing cost amounts from gross income.

2. Section 911(d)(1) of the Code defines the term “qualified individual” as an individual whose tax home is in a foreign country and who is (A) a citizen of the United States and establishes to the satisfaction of the Secretary of the Treasury that the individual has been a bona fide resident of a foreign country or countries for an uninterrupted period that includes an entire taxable year, or (B) a citizen or resident of the United States who, during any period of 12 consecutive months, is present in a foreign country or countries during at least 330 full days.

3. Section 911(d)(4) of the Code provides an exception to the eligibility requirements of § 911(d)(1). An individual will be treated as a qualified individual with respect to a period in which the indi

1999–14 I.R.B. 7 April 5, 1999

such foreign country if the individual establishes a reasonable expectation of meeting the requirements of § 911(d) but for those conditions.

6. To qualify for relief under § 911(d)(4) of the Code, an individual must have established residency or have been physically present in the foreign country on or prior to the date that the Secretary of the Treasury determines that individuals were required to leave the for

Tax Year 1996–

eign country. Individuals who establish residency or are first physically present in the foreign country after the date that the Secretary prescribes, shall not be treated as qualified individuals under § 911(d)(4) of the Code pursuant to § 911(d)(4)(C). For example, individuals who are first physically present in Albania after August 14, 1998, are not eligible to qualify for the exemption prescribed in § 911(d)(4) of the Code for taxable year 1998.

Date of Departure

7. In order to assist those individuals who are filing prior year or amended tax returns, the Internal Revenue Service is republishing the countries added to the list for tax years 1995, 1996 and 1997, for which the eligibility requirements of § 911(d)(1) of the Code are waived under § 911(d)(4):

Tax Year 1995 - No new departure dates were added to the list.

Country On or After On or Before

Central African Republic May 21, 1996 September 12, 1996

Tax Year 1997–

Date of Departure

Country On or After

Albania March 12,1997 Cambodia July 9, 1997 Central African Republic March 28, 1997 Democratic Republic of the Congo May 3, 1997 Republic of the Congo June 7, 1997 Sierra Leone May 28, 1997 Tajikistan November 26, 1997