Internal Revenue Bulletin:  2013-21 

May 20, 2013 

Notice 2013-31

Determination of Housing Cost Amount Eligible for Exclusion or Deduction for 2013


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 2013. 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 ($267.40 per day for 2013, or $97,600 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 2013 is $15,616 ($97,600 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 (computed on a daily basis) 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 $29,280 ($97,600 x .30) in 2013.

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, 2007-1 C.B. 760, for 2006; Notice 2007-77, 2007-2 C.B. 735, for 2007; Notice 2008-107, 2008-2 C.B. 1266, for 2008 and 2009; Notice 2010-27, 2010-15 I.R.B. 531, for 2009 and 2010; Notice 2011-8, 2011-8 I.R.B. 503, for 2010 and 2011; and Notice 2012-19, 2012-10 I.R.B. 440, for 2012 and 2013 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 2013

The following table provides adjusted limitations on housing expenses (in lieu of the otherwise applicable limitation of $29,280) for 2013.

Country Location Limitation on Housing Expenses (daily) Limitation on Housing Expenses (full year)
Angola Luanda 230.14 84,000
Argentina Buenos Aires 154.79 56,500
Australia Adelaide 96.44 35,200
Australia Brisbane 95.34 34,800
Australia Canberra 83.84 30,600
Australia Darwin, Northern Country 83.84 30,600
Australia Gold Coast 95.34 34,800
Australia Melbourne 122.19 44,600
Australia Oakey 95.34 34,800
Australia Perth 130.68 47,700
Australia Sydney 89.81 32,782
Australia Toowoomba 95.34 34,800
Austria Vienna 96.99 35,400
Bahamas, The Grand Bahama Island 84.66 30,900
Bahamas, The Nassau 136.16 49,700
Bahrain Bahrain 120.55 44,000
Barbados Barbados 103.29 37,700
Belgium Antwerp 96.16 35,100
Belgium Brussels 128.77 47,000
Belgium Gosselies 115.34 42,100
Belgium Hoogbuul 96.16 35,100
Belgium Mons 115.34 42,100
Belgium SHAPE/Chievres 115.34 42,100
Bermuda Bermuda 246.58 90,000
Bosnia-Herzegovina Sarajevo 82.19 30,000
Brazil Brasilia 126.03 46,000
Brazil Rio de Janeiro 96.16 35,100
Brazil Sao Paulo 155.07 56,600
Canada Calgary 129.86 47,400
Canada Dartmouth 107.95 39,400
Canada Edmonton 103.29 37,700
Canada Halifax 107.95 39,400
Canada London, Ontario 88.22 32,200
Canada Montreal 166.03 60,600
Canada Ottawa 148.49 54,200
Canada Quebec 126.03 46,000
Canada Toronto 153.97 56,200
Canada Vancouver 136.71 49,900
Canada Victoria 97.53 35,600
Canada Winnipeg 93.15 34,000
Cayman Islands Grand Cayman 131.51 48,000
Chile Santiago 153.70 56,100
China Beijing 195.07 71,200
China Hong Kong 313.15 114,300
China Shanghai 156.17 57,001
Colombia Bogota 160.82 58,700
Colombia All cities other than Bogota 135.34 49,400
Costa Rica San Jose 87.67 32,000
Denmark Copenhagen 119.74 43,704
Dominican Republic Santo Domingo 124.66 45,500
Ecuador Guayaquil 84.38 30,800
Ecuador Quito 89.32 32,600
Estonia Tallinn 127.67 46,600
France Garches 226.03 82,500
France Le Havre 91.23 33,300
France Lyon 127.12 46,400
France Marseille 121.92 44,500
France Montpellier 102.47 37,400
France Paris 226.03 82,500
France Sevres 226.03 82,500
France Suresnes 226.03 82,500
France Versailles 226.03 82,500
Germany Babenhausen 110.96 40,500
Germany Bad Aibling 94.52 34,500
Germany Bad Nauheim 88.77 32,400
Germany Baumholder 107.40 39,200
Germany Berlin 135.34 49,400
Germany Birkenfeld 107.40 39,200
Germany Boeblingen 134.52 49,100
Germany Bonn 115.07 42,000
Germany Butzbach 86.58 31,600
Germany Cologne 153.97 56,200
Germany Darmstadt 110.96 40,500
Germany Frankfurt am Main 115.62 42,200
Germany Friedberg 88.77 32,400
Germany Garmisch-Partenkirchen 102.47 37,400
Germany Gelnhausen 139.73 51,000
Germany Germersheim 83.84 30,600
Germany Giebelstadt 95.89 35,000
Germany Giessen 98.63 36,000
Germany Grafenwoehr 110.41 40,300
Germany Hanau 139.73 51,000
Germany Hannover 82.74 30,200
Germany Heidelberg 103.56 37,800
Germany Idar-Oberstein 107.40 39,200
Germany Ingolstadt 156.16 57,000
Germany Kaiserslautern, Landkreis 133.70 48,800
Germany Kitzingen 95.89 35,000
Germany Leimen 103.56 37,800
Germany Ludwigsburg 134.52 49,100
Germany Mainz 149.86 54,700
Germany Mannheim 103.56 37,800
Germany Munich 156.16 57,000
Germany Nellingen 134.52 49,100
Germany Neubruecke 107.40 39,200
Germany Ober Ramstadt 110.96 40,500
Germany Oberammergau 102.47 37,400
Germany Pirmasens 133.70 48,800
Germany Rheinau 103.56 37,800
Germany Schwetzingen 103.56 37,800
Germany Seckenheim 103.56 37,800
Germany Sembach 133.70 48,800
Germany Stuttgart 134.52 49,100
Germany Vilseck 110.41 40,300
Germany Wahn 115.07 42,000
Germany Wertheim 95.89 35,000
Germany Wiesbaden 149.86 54,700
Germany Wuerzburg 95.89 35,000
Germany Zweibrueken 133.70 48,800
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, Vilseck, Wahn, Wertheim, Wiesbaden, Worms, Wuerzburg, Zirndorf and Zweibrueken 108.77 39,700
Ghana Accra 98.63 36,000
Greece Argyroupolis 86.30 31,500
Greece Athens 110.68 40,400
Greece Elefsis 110.68 40,400
Greece Ellinikon 110.68 40,400
Greece Mt. Hortiatis 86.30 31,500
Greece Mt. Parnis 110.68 40,400
Greece Mt. Pateras 110.68 40,400
Greece Nea Makri 110.68 40,400
Greece Perivolaki 86.30 31,500
Greece Piraeus 110.68 40,400
Greece Tanagra 110.68 40,400
Greece Thessaloniki 86.30 31,500
Guatemala Guatemala City 113.70 41,500
Guyana Georgetown 95.89 35,000
Holy See, The Holy See, The 150.41 54,900
Hungary Budapest 89.04 32,500
Hungary Papá 121.92 44,500
India Mumbai 186.08 67,920
India New Delhi 82.88 30,252
Indonesia Jakarta 103.50 37,776
Ireland Dublin 130.96 47,800
Ireland Shannon Area 103.56 37,800
Israel Tel Aviv 139.18 50,800
Italy Catania 88.22 32,200
Italy Genoa 114.52 41,800
Italy Gioia Tauro 85.48 31,200
Italy La Spezia 110.68 40,400
Italy Leghorn 94.25 34,400
Italy Milan 224.93 82,100
Italy Naples 143.01 52,200
Italy Parma 114.25 41,700
Italy Pisa 94.25 34,400
Italy Pordenone-Aviano 114.25 41,700
Italy Rome 150.41 54,900
Italy Sigonella 88.22 32,200
Italy Turin 112.60 41,100
Italy Vicenza 115.34 42,100
Italy All cities other than Avellino, Brindisi, Catania, Florence, Gaeta, Genoa, Gioia Tauro, La Spezia, Leghorn, Milan, Mount Vergine, Naples, Nettuno, Parma, Pisa, Pordenone-Aviano, Rome, Sardinia, Sigonella, Turin, Verona, and Vicenza. 92.05 33,600
Jamaica Kingston 112.88 41,200
Japan Akashi 107.12 39,100
Japan Akizuki 94.25 34,400
Japan Atsugi 139.73 51,000
Japan Camp Zama 139.73 51,000
Japan Chiba-Ken 150.96 55,100
Japan Fussa 139.73 51,000
Japan Gifu 203.56 74,300
Japan Gotemba 102.19 37,300
Japan Haneda 139.73 51,000
Japan Iwakuni 107.95 39,400
Japan Kanagawa-Ken 139.73 51,000
Japan Komaki 203.56 74,300
Japan Machidi-Shi 139.73 51,000
Japan Misawa 116.16 42,400
Japan Nagoya 203.56 74,300
Japan Okinawa Prefecture 188.22 68,700
Japan Osaka-Kobe 248.39 90,664
Japan Sagamihara 139.73 51,000
Japan Saitama-Ken 139.73 51,000
Japan Sasebo 115.89 42,300
Japan Tachikawa 139.73 51,000
Japan Tokyo 320.82 117,100
Japan Tokyo-to 139.73 51,000
Japan Yokohama 175.89 64,200
Japan Yokosuka 163.01 59,500
Japan Yokota 139.73 51,000
Kazakhstan Almaty 131.51 48,000
Korea Ammo Depot #9 81.10 29,600
Korea Camp Carroll 88.77 32,400
Korea Camp Colbern 153.42 56,000
Korea Camp Market 153.42 56,000
Korea Camp Mercer 153.42 56,000
Korea Chinhae 82.19 30,000
Korea K-16 153.42 56,000
Korea Kimhae 83.84 30,600
Korea Kimpo Airfield 153.42 56,000
Korea Munsan 94.25 34,400
Korea Osan AB 96.71 35,300
Korea Pusan 83.84 30,600
Korea Pyongtaek 96.16 35,100
Korea Seoul 153.42 56,000
Korea Suwon 153.42 56,000
Korea Taegu 92.05 33,600
Korea Tongduchon 87.40 31,900
Korea Uijongbu 90.96 33,200
Korea Waegwan 88.77 32,400
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 88.77 32,400
Kuwait Kuwait City 176.44 64,400
Kuwait All cities other than Kuwait City 158.08 57,700
Luxembourg Luxembourg 123.56 45,100
Macedonia Skopje 96.99 35,400
Malaysia Kuala Lumpur 126.58 46,200
Malaysia All cities other than Kuala Lumpur 92.33 33,700
Mexico Malta 138.36 50,500
Mexico Mazatlan 84.93 31,000
Mexico Merida 103.84 37,900
Mexico Mexico City 131.23 47,900
Mexico Monterrey 90.96 33,200
Mexico All cities other than Ciudad Juarez, Cuernavaca, Guadalajara, Hermosillo, Matamoros, Mazatlan, Merida, Metapa, Mexico City, Monterrey, Nogales, Nuevo Laredo, Reynosa, Tapachula, Tijuana, Tuxtla Gutierrez, and Veracruz 107.95 39,400
Mozambique Maputo 108.22 39,500
Namibia Windhoek 87.95 32,100
Netherlands Amsterdam 144.93 52,900
Netherlands Aruba 98.63 36,000
Netherlands Brunssum 106.30 38,800
Netherlands Eygelshoven 106.30 38,800
Netherlands Hague, The 179.45 65,500
Netherlands Heerlen 106.30 38,800
Netherlands Hoensbroek 106.30 38,800
Netherlands Hulsberg 106.30 38,800
Netherlands Kerkrade 106.30 38,800
Netherlands Landgraaf 106.30 38,800
Netherlands Maastricht 106.30 38,800
Netherlands Papendrecht 108.22 39,500
Netherlands Rotterdam 108.22 39,500
Netherlands Schaesburg 106.30 38,800
Netherlands Schinnen 106.30 38,800
Netherlands Schiphol 144.93 52,900
Netherlands Ypenburg 179.45 65,500
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. 108.22 39,500
Netherlands Antilles Curacao 125.48 45,800
New Zealand Auckland 97.81 35,700
New Zealand Christchurch 87.95 32,100
New Zealand Wellington 92.60 33,800
Nicaragua Managua 87.12 31,800
Nigeria Abuja 98.63 36,000
Norway Oslo 147.40 53,800
Norway Stavanger 125.21 45,700
Norway All cities other than Oslo and Stavanger. 103.29 37,700
Panama Panama City 97.26 35,500
Peru Lima 107.12 39,100
Philippines Cavite 106.85 39,000
Philippines Manila 106.85 39,000
Poland Poland 80.55 29,400
Portugal Alverca 137.81 50,300
Portugal Lisbon 137.81 50,300
Qatar Doha 99.35 36,264
Qatar All cities other than Doha 88.77 32,400
Russia Moscow 295.89 108,000
Russia Saint Petersburg 164.38 60,000
Russia Sakhalin Island 212.33 77,500
Russia Vladivostok 212.33 77,500
Russia Yekaterinburg 129.86 47,400
Rwanda Kigali 86.30 31,500
Saudi Arabia Jeddah 84.02 30,667
Saudi Arabia Riyadh 109.59 40,000
Singapore Singapore 246.03 89,800
South Africa Pretoria 107.67 39,300
Spain Barcelona 111.23 40,600
Spain Madrid 183.56 67,000
Spain Rota 112.05 40,900
Spain Valencia 105.48 38,500
Suriname Paramaribo 90.41 33,000
Switzerland Bern 193.70 70,700
Switzerland Geneva 269.32 98,300
Switzerland Zurich 107.45 39,219
Switzerland All cities other than Bern, Geneva and Zurich 90.14 32,900
Taiwan Taipei 126.54 46,188
Tanzania Dar Es Salaam 120.55 44,000
Thailand Bangkok 161.64 59,000
Trinidad and Tobago Port of Spain 149.32 54,500
Turkey Izmir-Cigli 86.58 31,600
Turkey Yamanlar 86.58 31,600
Ukraine Kiev 197.26 72,000
United Arab Emirates Abu Dhabi 136.13 49,687
United Arab Emirates Dubai 156.64 57,174
United Kingdom Basingstoke 112.60 41,099
United Kingdom Bath 112.33 41,000
United Kingdom Bracknell 170.14 62,100
United Kingdom Bristol 106.03 38,700
United Kingdom Brookwood 120.55 44,000
United Kingdom Cambridge 117.81 43,000
United Kingdom Caversham 202.19 73,800
United Kingdom Cheltenham 146.03 53,300
United Kingdom Croughton 122.74 44,800
United Kingdom Fairford 122.74 44,800
United Kingdom Farnborough 149.86 54,700
United Kingdom Felixstowe 115.62 42,200
United Kingdom Gibraltar 122.24 44,616
United Kingdom Harrogate 129.04 47,100
United Kingdom High Wycombe 170.14 62,100
United Kingdom Kemble 122.74 44,800
United Kingdom Lakenheath 152.05 55,500
United Kingdom Liverpool 106.30 38,800
United Kingdom London 241.64 88,200
United Kingdom Loudwater 173.97 63,500
United Kingdom Menwith Hill 129.04 47,100
United Kingdom Mildenhall 152.05 55,500
United Kingdom Oxfordshire 119.45 43,600
United Kingdom Plymouth 119.45 43,600
United Kingdom Portsmouth 119.45 43,600
United Kingdom Reading 170.14 62,100
United Kingdom Rochester 124.66 45,500
United Kingdom Samlesbury 120.55 44,000
United Kingdom Southampton 121.10 44,200
United Kingdom Surrey 132.61 48,402
United Kingdom Waterbeach 124.11 45,300
United Kingdom Wiltshire 113.97 41,600
United Kingdom All cities other than Basingstoke, Bath, Belfast, Birmingham, Bracknell, Bristol, Brookwood, Brough, 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, Samlesbury, Southampton, Surrey, Waterbeach, Welford, West Byfleet, and Wiltshire. 120.55 44,000
Venezuela Caracas 156.16 57,000
Vietnam Hanoi 128.22 46,800
Vietnam Ho Chi Minh City 115.07 42,000

SECTION 4. ELECTION TO APPLY 2013 ADJUSTED LIMITATIONS TO 2012 TAXABLE YEAR

For some locations, the limitation on housing expenses provided in section 3 of this notice may be higher than the limitation on housing expenses provided in the “Table of Adjusted Limitations for 2012” in Notice 2012-19. A qualified individual incurring housing expenses in such a location during 2012 may apply the adjusted limitation on housing expenses provided in section 3 of this notice in lieu of the amounts provided in the “Table of Adjusted Limitations for 2012” in Notice 2012-19 (and as set forth in the Instructions to Form 2555 (2012)).

The IRS and the Treasury Department anticipate that future annual notices providing adjustments to housing expense limitations will make a similar election available to qualified individuals that incur housing expenses in the immediately preceding year. For example, when adjusted housing expense limitations for 2014 are issued, it is expected that taxpayers will be permitted to apply those adjusted limitations to the 2013 taxable year.

SECTION 5. EFFECT ON OTHER DOCUMENTS

This notice supersedes Notice 2006-87, 2006-2 C.B. 766; Notice 2007-25, 2007-1 C.B. 760; Notice 2007-77; 2007-2 C.B. 735; Notice 2008-107, 2008-2 C.B. 1266; Notice 2010-27, 2010-15 I.R.B. 531; Notice 2011-8, 2011-8 I.R.B. 503; and Notice 2012-19, 2012-10 I.R.B. 440.

SECTION 6. EFFECTIVE DATE

This notice is effective for taxable years beginning on or after January 1, 2013. However, as provided in section 4, a taxpayer may elect to apply the 2013 adjusted housing limitations contained in section 3 of this notice to his or her taxable year beginning in 2012.

DRAFTING INFORMATION

The principal author of this notice is Susan E. Massey of the Office of Associate Chief Counsel (International). For further information regarding this notice contact Ms. Massey at (202) 622-3840 (not a toll-free call).


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