Physical-Presence Test

It’s the tax equivalent to the finders/keepers rule, or the universally recognized smelt it/dealt it assessment. Basically, the physical-presence test represents a simplistic rubric that solves an otherwise sticky legalistic situation.

In this case, we're dealing with taxation. In complicated situations, it can be confusing which tax jurisdiction a person should operate under. It comes up most with U.S. citizens working overseas during part of the year.

Are those earnings foreign earnings or U.S. earnings? Just apply the physical-presence test to find out. You're considered outside the U.S. if you're in a foreign country (or a series of foreign countries, if you're on your around-the-world tour), if you are physically in those countries for 330 days out of a 12-month span.