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Message: [QUOTE="Green, post: 2518719, member: 20202"] Actually there is an adjustment for your housing allowance. It's based off the city you are a foreign resident of. Dubai has a very high cost of living adjustment. I believe it's in the high 40k range. So you get your 90k+ exclusion plus the cost of living adjustment which puts your tax free income at 130-140k. The international waters issue is a tough one to monitor. A flight from Dubai to MNL for example could be largely over international waters or it could be nearly entirely over land if you take the northerly route. Entirely depends on the winds, weather, etc. Dubai-LAX is virtually entirely over land because you head straight north over the pole and then south over Canada. I wonder if the IRS tracks the ice melt when determining international waters... [/QUOTE]