Taxes are truly taxing on the nerves of Expatriates living abroad.
Form 2555 - PDF link to the form from the USA government on the Foreign Earned Income exclusion that allows you to earn up to 91,500 in 2010.Read
Foreign earned income exclusion defined:
The United States taxes citizens and residents on their worldwide income. Citizens and residents living and working outside the U.S. may be entitled to a foreign earned income exclusion that reduces taxable income. For 2010, the maximum exclusion is $91,500 per taxpayer. In addition, the taxpayer may exclude housing expenses in excess of 16% of this maximum (i.e., $40.11 per day in 2010), but with limits. The exclusion is available only for wages or self employment income earned for services performed outside the U.S. The exclusion is claimed on IRS Form 2555 on an expat tax return.