Digital Nomad
Digital Nomads & Foreign Earned Income Exclusion: War, Adversity, and the New Waiver Countries
Recent changes allow nomadic workers from certain countries to waive residency or presence tests when filing under foreign earned income exclusion—a vital update for many mobile professionals.
By NomadicTax Research Team • 5-8 min read • November 16, 2025
## What Is the Foreign Earned Income Exclusion (FEIE)?
Many U.S. citizens or **resident aliens living abroad** can exclude up to a certain amount of foreign earned income from their U.S. taxes each year—provided they meet either the **bona fide residence test** or the **physical presence test**, as outlined in IRC § 911. This exclusion helps reduce double taxation and supports remote or nomadic work lifestyles. ([irs.gov](https://www.irs.gov/irb/2025-13_IRB?utm_source=openai))
## Recent Policy Change: Waiver for Adverse Conditions
A new Revenue Procedure (2025-17) has added **Ukraine, Iraq, Haiti, and Bangladesh** to the list of countries for which the minimum time requirements (for either bona fide residence or physical presence tests) are **waived** if the individual had to leave those countries because of war, civil unrest, or similar adverse conditions. This applies for tax year 2024. ([irs.gov](https://www.irs.gov/irb/2025-13_IRB?utm_source=openai))
## Who This Impacts
- **Digital nomads** who were forced to relocate suddenly due to conflict or unrest.
- U.S. expats who split time between multiple countries and may not meet standard physical presence thresholds.
- Individuals with homes in these newly designated waiver countries who can now access FEIE despite disruptions.
## Example Case
> Maria, a freelance developer living in Kyiv in early 2024, was displaced by conflict mid-year. Under the new waiver, she no longer needs to meet the full 330 days physical presence requirement to qualify for FEIE for 2024 because Ukraine is now a waiver country. She may still exclude foreign earned income under IRC § 911 as long as other FEIE requirements are met.
## Steps for Digital Nomads
- Determine if your time abroad was disrupted due to **war, civil unrest, or similar adverse conditions**.
- Confirm if your country is now on the waiver list—**Ukraine, Iraq, Haiti, Bangladesh**.
- Keep detailed records showing your travel, forced departure, or relocation events.
- File the proper election for FEIE on your IRS return—attach relevant explanations or documentation.
- Consult tax professionals familiar with expat tax rules to ensure compliance and maximize benefits.
**Bottom line:** This waiver is a meaningful opportunity for those whose lives were uprooted by conflict to still benefit from FEIE—even if physical presence or residency requirements weren’t met as a result of such conditions. Stay informed and document thoroughly to make the most of it.