JotikaT2
Employee Tax Expert

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It depends upon which country issued the pension income.

 

If the pension was from Canadian sources, then you would be subject to U.S. taxes up to the amount that would have been included on a Canadian return if you were considered a Canadian citizen.  Canada limits the tax to 15% of the gross amount received.  Please see the excerpt from Publication 597, Information on the United States-Canada Income Tax Treaty.

 

 

Pensions are not considered exempt from U.S. tax per Publication 901.  Please see the excerpt for pensions below.

 

 

This income would not be reported on Form 8833, but would be reported on your 1040 form.  You can file Form 1116 to obtain a foreign tax credit for any taxes paid in Canada that relate to the pension income that is also taxable in the United States.  This will ensure you receive a credit for any taxes already paid to Canada and will be used to offset the tax due on your U.S. tax return.

 

@AllenW2 

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