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Case Study 1: Earned IncomeAlisa, a U.S. resident, is in the Armed Forces and has lived in Japan since 2014. Her military pay is not eligible for the foreign earned income exclusion. In her spare time, she is a self-employed DJ in Tokyo, Japan and the surrounding area. The income from her self-employment may qualify for the exclusion. Click here for an explanation. To qualify for the exclusion, income must be earned income. Earned income includes:
To qualify for the exclusion, the earned income must be for services (other than military or U.S. government) performed in a foreign country. 
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