Internal Revenue Bulletin:  2008-50 

December 15, 2008 

Notice 2008-107

Determination of Housing Cost Amounts Eligible for Exclusion or Deduction for 2008


SECTION 1. PURPOSE

This notice provides adjustments to the limitation on housing expenses for purposes of section 911 of the Internal Revenue Code (Code) for specific locations for 2008. These adjustments are made on the basis of geographic differences in housing costs relative to housing costs in the United States.

SECTION 2. BACKGROUND

Section 911(a) of the Code allows a qualified individual to elect to exclude from gross income the foreign earned income and housing cost amount of such individual. Section 911(c)(1) defines the term “housing cost amount” as an amount equal to the excess of (A) the housing expenses of an individual for the taxable year to the extent such expenses do not exceed the amount determined under section 911(c)(2), over (B) 16 percent of the exclusion amount (computed on a daily basis) in effect under section 911(b)(2)(D) for the calendar year in which such taxable year begins ($239.34 per day for 2008, or $87,600 for the full year), multiplied by the number of days of that taxable year within the applicable period described in section 911(d)(1). The applicable period is the period during which the individual meets the tax home requirement of section 911(d)(1) and either the bona fide residence requirement of section 911(d)(1)(A) or the physical presence requirement of section 911(d)(1)(B). Assuming that the entire taxable year of a qualified individual is within the applicable period, the section 911(c)(1)(B) amount for 2008 is $14,016 ($87,600 x .16).

Section 911(c)(2)(A) of the Code limits the housing expenses taken into account in section 911(c)(1)(A) to an amount equal to (i) 30 percent (adjusted as may be provided under the Secretary’s authority under section 911(c)(2)(B)) of the amount in effect under section 911(b)(2)(D) for the calendar year in which the taxable year of the individual begins, multiplied by (ii) the number of days of that taxable year within the applicable period described in section 911(d)(1). Thus, under this general limitation, a qualified individual whose entire taxable year is within the applicable period is limited to maximum housing expenses of $26,280 ($87,600 x .30) in 2008.

Section 911(c)(2)(B) of the Code authorizes the Secretary to issue regulations or other guidance to adjust the percentage under section 911(c)(2)(A)(i) based on geographic differences in housing costs relative to housing costs in the United States. Pursuant to this authority, the Internal Revenue Service (IRS) and the Treasury Department published Notice 2006-87, 2006-2 C.B. 766, and Notice 2007-25, 2007-12 I.R.B. 760, for 2006, and Notice 2007-77, 2007-40 I.R.B. 735, for 2007, to provide adjustments to the limitation on housing expenses for qualified individuals incurring housing expenses in countries with high housing costs relative to housing costs in the United States.

SECTION 3. TABLE OF ADJUSTED LIMITATIONS FOR 2008

The following table provides adjusted limitations on housing expenses (in lieu of the otherwise applicable limitation of $26,280) for 2008.

Country Location Limitation on Housing Expenses (daily) Limitation on Housing Expenses (full year)
Argentina Buenos Aires 125.96 46,100
Australia Brisbane 81.42 29,800
Australia Canberra 76.50 28,000
Australia Gold Coast 81.42 29,800
Australia Melbourne 78.96 28,900
Australia Oakey 81.42 29,800
Australia Perth 118.85 43,500
Australia Toowoomba 81.42 29,800
Austria Vienna 96.72 35,400
Bahamas, The Nassau 135.79 49,700
Bahrain Bahrain 120.22 44,000
Barbados Barbados 103.01 37,700
Belgium Antwerp 116.67 42,700
Belgium Brussels 157.65 57,700
Belgium Gosselies 110.11 40,300
Belgium Hoogbuul 116.67 42,700
Belgium Mons 110.11 40,300
Belgium SHAPE/Chievres 110.11 40,300
Bermuda Bermuda 245.90 90,000
Bosnia-Herzegovina Sarajevo 89.89 32,900
Brazil Brasilia 121.31 44,400
Brazil Rio de Janeiro 95.90 35,100
Brazil Sao Paulo 127.05 46,500
Canada Calgary 110.93 40,600
Canada Dartmouth 95.63 35,000
Canada Edmonton 100.82 36,900
Canada Halifax 95.63 35,000
Canada London, Ontario 81.42 29,800
Canada Montreal 158.20 57,900
Canada Ottawa 130.87 47,900
Canada Toronto 129.78 47,500
Canada Vancouver 125.68 46,000
Canada Victoria 95.08 34,800
Canada Winnipeg 82.51 30,200
Cayman Islands Grand Cayman 131.15 48,000
Chile Santiago 124.32 45,500
China Beijing 134.25 49,137
China Hong Kong 312.30 114,300
China Shanghai 155.74 57,001
Colombia Bogota 147.81 54,100
Colombia All cities other than Bogota and Barranquilla. 122.68 44,900
Denmark Copenhagen 119.41 43,704
Dominican Republic Santo Domingo 124.32 45,500
Ecuador Guayaquil 84.15 30,800
Ecuador Quito 83.33 30,500
Egypt Cairo 74.43 27,240
Estonia Tallinn 127.32 46,600
France Garches 273.50 100,100
France Le Havre 114.75 42,000
France Lyon 155.46 56,900
France Marseille 143.17 52,400
France Montpellier 126.78 46,400
France Paris 273.50 100,100
France Sevres 273.50 100,100
France Suresnes 273.50 100,100
France Versailles 273.50 100,100
Germany Babenhausen 134.15 49,100
Germany Bad Aibling 114.48 41,900
Germany Bad Nauheim 107.10 39,200
Germany Baumholder 121.86 44,600
Germany Berlin 163.93 60,000
Germany Birkenfeld 121.86 44,600
Germany Boeblingen 145.90 53,400
Germany Butzbach 104.92 38,400
Germany Darmstadt 134.15 49,100
Germany Erlangen 84.97 31,100
Germany Frankfurt am Main 139.89 51,200
Germany Friedberg 107.10 39,200
Germany Fuerth 84.97 31,100
Germany Garmisch-Partenkirchen 115.85 42,400
Germany Geilenkirchen 92.35 33,800
Germany Gelnhausen 145.08 53,100
Germany Germersheim 101.91 37,300
Germany Giebelstadt 116.39 42,600
Germany Giessen 104.92 38,400
Germany Grafenwoehr 114.48 41,900
Germany Hanau 145.08 53,100
Germany Hannover 100.00 36,600
Germany Heidelberg 133.88 49,000
Germany Idar-Oberstein 121.86 44,600
Germany Ingolstadt 169.40 62,000
Germany Kaiserslautern, Landkreis 149.18 54,600
Germany Kitzingen 116.39 42,600
Germany Leimen 133.88 49,000
Germany Ludwigsburg 145.90 53,400
Germany Mainz 164.48 60,200
Germany Mannheim 133.88 49,000
Germany Munich 169.40 62,000
Germany Nellingen 145.90 53,400
Germany Neubruecke 121.86 44,600
Germany Nuernberg 84.97 31,100
Germany Ober Ramstadt 134.15 49,100
Germany Oberammergau 115.85 42,400
Germany Pirmasens 149.18 54,600
Germany Rheinau 133.88 49,000
Germany Schwabach 84.97 31,100
Germany Schwetzingen 133.88 49,000
Germany Seckenheim 133.88 49,000
Germany Sembach 149.18 54,600
Germany Stuttgart 145.90 53,400
Germany Wertheim 116.39 42,600
Germany Wiesbaden 164.48 60,200
Germany Wuerzburg 116.39 42,600
Germany Zimdorf 84.97 31,100
Germany Zweibrueken 149.18 54,600
Germany All cities other than Augsburg, Babenhausen, Bad Aibling, Bad Kreuznach, Bad Nauheim, Baumholder, Berchtesgaden, Berlin, Birkenfeld, Boeblingen, Bonn, Bremen, Bremerhaven, Butzbach, Cologne, Darmstadt, Delmenhorst, Duesseldorf, Erlangen, Flensburg, Frankfurt am Main, Friedberg, Fuerth, Garlstedt, Garmisch-Partenkirchen, Geilenkirchen, Gelnhausen, Germersheim, Giebelstadt, Giessen, Grafenwoehr, Grefrath, Greven, Gruenstadt, Hamburg, Hanau, Handorf, Hannover, Heidelberg, Heilbronn, Herongen, Idar-Oberstein, Ingolstadt, Kaiserslautern, Landkreis, Kalkar, Karlsruhe, Kerpen, Kitzingen, Koblenz, Leimen, Leipzig, Ludwigsburg, Mainz, Mannheim, Mayen, Moenchen-Gladbach, Muenster, Munich, Nellingen, Neubruecke, Noervenich, Nuernberg, Ober Ramstadt, Oberammergau, Osterholz-Scharmbeck, Pirmasens, Rheinau, Rheinberg, Schwabach, Schwetzingen, Seckenheim, Sembach, Stuttgart, Twisteden, Wahn, Wertheim, Wiesbaden, Worms, Wuerzburg, Zimdorf and Zweibrueken. 125.41 45,900
Greece Argyroupolis 104.64 38,300
Greece Athens 107.92 39,500
Greece Elefsis 107.92 39,500
Greece Ellinikon 107.92 39,500
Greece Mt. Hortiatis 104.64 38,300
Greece Mt. Parnis 107.92 39,500
Greece Mt. Pateras 107.92 39,500
Greece Nea Makri 107.92 39,500
Greece Perivolaki 104.64 38,300
Greece Piraeus 107.92 39,500
Greece Souda Bay (Crete) 83.61 30,600
Greece Tanagra 107.92 39,500
Greece Thessaloniki 104.64 38,300
Guatemala Guatemala City 102.73 37,600
Holy See, The Holy See, The 182.24 66,700
Hungary Budapest 88.80 32,500
India Mumbai 185.57 67,920
India New Delhi 82.66 30,252
Indonesia Jakarta 103.21 37,776
Ireland Dublin 158.20 57,900
Ireland Limerick 89.34 32,700
Ireland Shannon Area 89.34 32,700
Italy Catania 106.56 39,000
Italy Gaeta 77.05 28,200
Italy Genoa 110.38 40,400
Italy Gioia Tauro 85.25 31,200
Italy La Spezia 110.38 40,400
Italy Leghorn 114.21 41,800
Italy Milan 272.13 99,600
Italy Naples 150.27 55,000
Italy Pisa 114.21 41,800
Italy Pordenone-Aviano 125.68 46,000
Italy Rome 182.24 66,700
Italy Sardinia 93.44 34,200
Italy Sigonella 106.56 39,000
Italy Turin 136.07 49,800
Italy Verona 86.89 31,800
Italy Vicenza 126.78 46,400
Italy All cities other than Avellino, Brindisi, Catania, Florence, Gaeta, Genoa, Gioia Tauro, La Spezia, Leghorn, Milan, Mount Vergine, Naples, Nettuno, Pisa, Pordenone-Aviano, Rome, Sardinia, Sigonella, Turin, Verona, and Vicenza. 104.64 38,300
Jamaica Kingston 112.57 41,200
Japan Akashi 86.07 31,500
Japan Akizuki 75.68 27,700
Japan Atsugi 108.47 39,700
Japan Camp Zama 108.47 39,700
Japan Chiba-Ken 108.47 39,700
Japan Fussa 108.47 39,700
Japan Gifu 79.78 29,200
Japan Gotemba 81.97 30,000
Japan Haneda 108.47 39,700
Japan Kanagawa-Ken 108.47 39,700
Japan Komaki 79.78 29,200
Japan Machidi-Shi 108.47 39,700
Japan Misawa 78.96 28,900
Japan Nagoya 103.24 37,786
Japan Okinawa Prefecture 133.06 48,700
Japan Osaka-Kobe 144.91 53,036
Japan Sagamihara 108.47 39,700
Japan Saitama-Ken 108.47 39,700
Japan Sasebo 81.42 29,800
Japan Tachikawa 108.47 39,700
Japan Tokyo 257.38 94,200
Japan Tokyo-to 108.47 39,700
Japan Yokohama 138.25 50,600
Japan Yokosuka 118.58 43,400
Japan Yokota 108.47 39,700
Kazakhstan Almaty 131.15 48,000
Korea Camp Carroll 80.05 29,300
Korea Camp Colbern 178.69 65,400
Korea Camp Market 178.69 65,400
Korea Camp Mercer 178.69 65,400
Korea Chinhae 82.79 30,300
Korea Chunchon 76.78 28,100
Korea K-16 178.69 65,400
Korea Kimhae 85.79 31,400
Korea Kimpo Airfield 178.69 65,400
Korea Kwangju 81.97 30,000
Korea Munsan 75.41 27,600
Korea Osan AB 93.17 34,100
Korea Pusan 85.79 31,400
Korea Pyongtaek 93.17 34,100
Korea Seoul 178.69 65,400
Korea Suwon 178.69 65,400
Korea Taegu 100.00 36,600
Korea Tongduchon 75.41 27,600
Korea Uijongbu 106.56 39,000
Korea Waegwan 80.05 29,300
Korea All cities other than Ammo Depot #9, Camp Carroll, Camp Colbern, Camp Market, Camp Mercer, Changwon, Chinhae, Chunchon, K-16, Kimhae, Kimpo Airfield, Kunsun, Kwangju, Munsan, Osan AB, Pusan, Pyongtaek, Seoul, Suwon, Taegu, Tongduchon, Uijongbu, and Waegwan. 87.16 31,900
Kuwait Kuwait City 177.87 65,100
Kuwait All cities other than Kuwait City. 159.29 58,300
Luxembourg Luxembourg 149.45 54,700
Macedonia Skopje 96.72 35,400
Malaysia Kuala Lumpur 138.80 50,800
Malaysia All cities other than Kuala Lumpur. 92.08 33,700
Malta Malta 122.95 45,000
Mexico Hermosillo 98.36 36,000
Mexico Mazatlan 88.52 32,400
Mexico Merida 103.55 37,900
Mexico Mexico City 125.41 45,900
Mexico Monterrey 117.21 42,900
Mexico All cities other than Ciudad Juarez, Cuernavaca, Guadalajara, Hermosillo, Matamoros, Mazatlan, Merida, Metapa, Mexico City, Monterrey, Nogales, Nuevo Laredo, Tapachula, Tijuana, Tuxtla Gutierrez, and Veracruz. 107.65 39,400
Micronesia Pohnpei 75.14 27,500
Netherlands Amsterdam 144.54 52,900
Netherlands Aruba 98.36 36,000
Netherlands Brunssum 103.28 37,800
Netherlands Eygelshoven 103.28 37,800
Netherlands Hague, The 187.16 68,500
Netherlands Heerlen 103.28 37,800
Netherlands Hoensbroek 103.28 37,800
Netherlands Hulsberg 103.28 37,800
Netherlands Kerkrade 103.28 37,800
Netherlands Landgraaf 103.28 37,800
Netherlands Maastricht 103.28 37,800
Netherlands Papendrecht 130.87 47,900
Netherlands Rotterdam 130.87 47,900
Netherlands Schaesburg 103.28 37,800
Netherlands Schinnen 103.28 37,800
Netherlands Schiphol 144.54 52,900
Netherlands Ypenburg 187.16 68,500
Netherlands All cities other than Amsterdam, Aruba, Brunssum, Coevorden, Eygelshoven, The Hague, Heerlen, Hoensbroek, Hulsberg, Kerkrade, Landgraaf, Maastricht, Margraten, Papendrecht, Rotterdam, Schaesburg, Schinnen, Schiphol, and Ypenburg. 95.63 35,000
Netherlands Antilles Curacao 101.91 37,300
New Zealand Auckland 97.54 35,700
New Zealand Wellington 92.35 33,800
Nicaragua Managua 86.89 31,800
Norway Oslo 159.29 58,300
Norway Stavanger 108.20 39,600
Norway All cities other than Oslo and Stavanger. 103.01 37,700
Panama Panama City 96.99 35,500
Peru Lima 74.59 27,300
Phillippines Cavite 98.36 36,000
Phillippines Manila 98.36 36,000
Phillippines All cities other than Cavite and Manila. 76.23 27,900
Poland Poland 80.33 29,400
Portugal Alverca 166.67 61,000
Portugal Lajes Field 82.24 30,100
Portugal Lisbon 166.67 61,000
Qatar Doha 99.08 36,264
Qatar All cities other than Doha. 88.52 32,400
Russia Moscow 248.36 90,900
Russia Saint Petersburg 119.67 43,800
Russia Sakhalin Island 211.75 77,500
Russia Vladivostok 211.75 77,500
Russia Yekaterinburg 129.51 47,400
Rwanda Kigali 86.07 31,500
Saudi Arabia Jeddah 83.79 30,667
Saudi Arabia Riyadh 87.43 32,000
Singapore Singapore 176.23 64,500
South Africa Pretoria 109.84 40,200
Spain Barcelona 110.93 40,600
Spain Madrid 123.50 45,200
Spain Rota 106.01 38,800
Spain Valencia 127.60 46,700
Spain All cities other than Barcelona, Madrid, Rota and Valencia. 76.23 27,900
Switzerland Bern 162.30 59,400
Switzerland Geneva 229.78 84,100
Switzerland Zurich 107.16 39,219
Switzerland All cities other than Bern, Geneva, and Zurich. 89.89 32,900
Taiwan Taipei 126.20 46,188
Thailand Bangkok 139.62 51,100
Turkey Ankara 88.80 32,500
Turkey Elmadag 88.80 32,500
Turkey Izmir-Cigli 86.34 31,600
Turkey Manzarali 88.80 32,500
Turkey Yamanlar 86.34 31,600
Ukraine Kiev 196.72 72,000
United Arab Emirates Abu Dhabi 135.76 49,687
United Arab Emirates Dubai 156.21 57,174
United Kingdom Basingstoke 112.29 41,099
United Kingdom Bath 112.02 41,000
United Kingdom Bracknell 169.67 62,100
United Kingdom Bristol 105.74 38,700
United Kingdom Cambridge 117.49 43,000
United Kingdom Caversham 201.64 73,800
United Kingdom Cheltenham 127.87 46,800
United Kingdom Chicksands 72.40 26,500
United Kingdom Croughton 117.76 43,100
United Kingdom Fairford 112.02 41,000
United Kingdom Farnborough 149.45 54,700
United Kingdom Felixstowe 122.95 45,000
United Kingdom Gibraltar 121.90 44,616
United Kingdom Harrogate 126.78 46,400
United Kingdom High Wycombe 169.67 62,100
United Kingdom Kemble 112.02 41,000
United Kingdom Lakenheath 150.55 55,100
United Kingdom Liverpool 106.01 38,800
United Kingdom London 226.50 82,900
United Kingdom Loudwater 173.50 63,500
United Kingdom Menwith Hill 126.78 46,400
United Kingdom Mildenhall 150.55 55,100
United Kingdom Oxfordshire 117.76 43,100
United Kingdom Plymouth 117.76 43,100
United Kingdom Portsmouth 117.76 43,100
United Kingdom Reading 169.67 62,100
United Kingdom Rochester 109.02 39,900
United Kingdom Southampton 120.77 44,200
United Kingdom Surrey 132.25 48,402
United Kingdom Waterbeach 119.95 43,900
United Kingdom West Byfleet 72.13 26,400
United Kingdom Wiltshire 113.66 41,600
United Kingdom All cities other than Basingstoke, Bath, Belfast, Birmingham, Bracknell, Bristol, Brough, Bude, Cambridge, Caversham, Chelmsford, Cheltenham, Chicksands, Croughton, Dunstable, Edinburgh, Edzell, Fairford, Farnborough, Felixstowe, Ft. Halstead, Gibraltar, Glenrothes, Greenham Common, Harrogate, High Wycombe, Hythe, Kemble, Lakenheath, Liverpool, London, Loudwater, Menwith Hill, Mildenhall, Nottingham, Oxfordshire, Plymouth, Portsmouth, Reading, Rochester, Southampton, Surrey, Waterbeach, Welford, West Byfleet, and Wiltshire. 113.93 41,700
Venezuela Caracas 155.74 57,000
Vietnam Hanoi 128.22 46,800
Vietnam Ho Chi Minh City 115.07 42,000

EFFECTIVE DATE

This notice is effective for taxable years beginning on or after January 1, 2008.

DRAFTING INFORMATION

The principal author of this notice is Paul J. Carlino of the Office of Associate Chief Counsel (International). For further information regarding this notice, contact Mr. Carlino at (202) 622-3840 (not a toll-free call).


More Internal Revenue Bulletins