US taxpayers living in Bermuda will see a reduction in their tax bill after the foreign housing expenses exclusion amount was raised to $72,000.

Last month, the US Treasury had raised the amount of housing expenses a citizen resident on the Island could claim on their tax return from $26,200 to $72,000 — but only if they lived in the City of Hamilton.

It is understood that many US citizens living here protested that decision and now the allowance has been extended to those living in all parts of the Island.

[bul] For a more thorough explanation of the implications of the change, which is retroactive to January 1, 2006, see US Tax Issues on page 16.