I feel that I need to clarify this tax equalization....the way I read it. It seems that a lot of folks DONT understand it. First, there is no reason to pay the same taxes as if you were in the US, because you ARE NOT in the US, and you are entitled to an $82000+ exclusion, after meeting certain criteria. Now, I agree that with CDG it will be to ones benefit. But in countries that will tax you at a lower %, you could be better off without the equalization.

Take SFS. An FO, married with two kids, no property in the US, no gains on any investments, will pay around $3000 federal per year. That is because he first takes his income, say $150K, subtracts his $82.4K for foreign earned income exclusion, that leaves $67.6K. Then he takes out his housing deductions and others. The number you come up with is what you would pay taxes on. If SFS had the equalization BS, we would be paying a lot more than we do!!!!