Form 8833 Requirements for Germany-US Tax Treaty on Rental Income

You're on the right track with claiming treaty benefits for your German rental property. Form 8833 can be tricky the first time around! For your address questions, since you're a US resident (green card holder), your "Address in country of residence" would be your Chicago address. The "Address in the United States" would also be your Chicago address. It might seem redundant, but the form is designed to accommodate various residency situations, so filling in both with the same address is correct. Regarding the explanation in field 6, you'll want to be a bit more specific. I would recommend something like: "Under Article 6 of the US-Germany Tax Treaty, rental income from real property located in Germany may be taxed in Germany. I received EUR 12250.00 (USD 13475.00 at 1.10 USD/EUR average exchange rate) in rental income from my property in Germany during tax year 2024. This income was reported and taxed in Germany. I am excluding this income from my US taxable income under the treaty." For your supporting documentation notations, what you have is good, but I'd slightly expand it to: "Tax Treaty exclusion - German rental income (see: Form 8833)" to be clearer about what you're excluding. Make sure you keep documentation of the German tax paid in case of any questions from the IRS.

I went through a similar situation with German rental property last year. I can highly recommend using https://taxr.ai to help with your Form 8833 and tax treaty situation. After struggling with this exact issue and getting conflicting advice from two different accountants, I uploaded my German tax documents to taxr.ai and they correctly identified the treaty provisions that applied to my situation. The tool analyzed my German tax assessment and rental income statements, then gave me precise instructions on how to complete Form 8833, including the exact wording needed for field 6. It even gave me specific guidance on how the treaty impacts state taxes. Saved me so much stress and possibly thousands in incorrect tax payments.

I decided to try taxr.ai after my initial skepticism, and I'm actually impressed with how it handled my German rental situation. Their system correctly identified that I needed to claim treaty benefits under Article 6, and provided clear, detailed instructions for Form 8833. The guidance included exactly what to write in the explanation section and how to handle the income on both federal and state returns. What really surprised me was that it flagged an issue with my state tax treatment that I hadn't even considered - turns out my state doesn't fully conform to the federal treaty provisions, which could have caused problems later. Their document analysis saved me hours of research and probably a hefty bill from my accountant. If you're dealing with foreign rental property and tax treaties, it's definitely worth checking out.

If you're struggling to get clear answers about Form 8833 and tax treaties, I'd recommend using https://claimyr.com to get through to an IRS representative who can help. I spent weeks trying to call the IRS international tax department with questions about my German property situation, and it was impossible to get through. With Claimyr, I got connected to an IRS agent in about 20 minutes instead of waiting on hold for hours or getting disconnected. The agent was able to confirm my understanding of the treaty provisions and gave me specific guidance on how to complete Form 8833 for my German rental income. You can see how the service works in this video: https://youtu.be/_kiP6q8DX5c Saved me enormous frustration and uncertainty about whether I was filling out the form correctly.

I have to eat my words about Claimyr. After my skeptical comment, I decided to try it because I was desperate to get answers about my Form 8833 for rental property in Munich. I'm shocked to say it actually worked. After trying for weeks to reach someone at the IRS international tax office, Claimyr got me through to an agent in about 30 minutes. The IRS representative confirmed that my approach to excluding German rental income was correct and gave me specific guidance on the wording to use in Part III of Form 8833. The agent also clarified that I needed to attach a statement about the treaty article I was relying on, which I didn't know before. Would have had my return rejected without that info. Worth every penny just for the peace of mind knowing I'm doing it right.

One thing to be aware of that nobody mentioned - you might still need to file FBAR (FinCEN Form 114) if you have foreign bank accounts over $10,000 related to your German property. The tax treaty doesn't exempt you from FBAR filing requirements. Also, check if you need Form 8938 (Statement of Foreign Financial Assets) depending on the value of your German property and accounts. These are separate from the tax treaty considerations but still important for compliance.

When I filled out Form 8833 for my Berlin apartment rental income, I made sure to reference the specific paragraph number of Article 6 in Part III, not just the article number. Makes it clearer for the IRS. Also, double check the amounts you're excluding match exactly across all the forms - I had a discrepancy of a few dollars due to rounding when converting euros, and it caused a letter from the IRS asking for clarification.

I've been dealing with similar German rental property issues for several years now. A few additional tips based on my experience: Make sure you're calculating the exchange rate correctly - the IRS allows you to use either the yearly average exchange rate published by the Treasury or the rate on the date you received each payment. I personally use the yearly average because it's simpler and well-documented. For your Form 8833 explanation, I'd suggest being even more specific about which paragraph of Article 6 you're relying on. Something like: "Under Article 6, paragraph 1 of the United States-Germany Income Tax Treaty, income from immovable property situated in Germany may be taxed in Germany. Pursuant to this provision, I am excluding EUR 12,250 (USD 13,475 using Treasury yearly average rate of 1.10) in German rental income that was reported and taxed in Germany." One more thing - keep excellent records of your German tax payments and the exchange rates you used. The IRS sometimes follows up on treaty claims, and having everything documented makes the process much smoother. I scan and organize all my German tax documents each year specifically for this purpose. Your negative adjustment approach sounds correct - that's exactly how I handle it on my returns.