Many US expats are surprised to learn that even if they reduce their income tax using exclusions or credits, they may still owe self-employment tax.
Self-employment tax covers Social Security and Medicare contributions for freelancers, consultants, and business owners.
In most cases, yes. The Foreign Earned Income Exclusion does not eliminate self-employment tax.
Some expats may avoid self-employment tax if they are covered under a totalization agreement between the US and their country of residence.
Many expats think they owe nothing, only to discover they still have a tax liability due to self-employment tax.