So, in Summary only hacks, but no solution, and TurboTax seemingly unwilling to fix the problem given the number of years this is going on as a problem in the community.
Summary:
1) IRS instructions for 1040 say to report Foreign Pensions on 1040 lines 5a and 5b.
2) The only way TurboTax supports filing Foreign Pensions so that they are reported on Lines 5a/b is essentially to pretend they are domestic pensions and fill out a substitute 1099R, which the IRS does not want or require since that is only for situations where you should have gotten a 1099R.
3) Even if we accept using that method, the IRS also does not want us to file with "bogus" EINs which is the only way TurboTax supports e-filing. (this is not an IRS limitation) And even the TurboTax employees cannot seem to agree on what number to use. (Just try one until it goes through) (really guys???)
4) The other suggested solution, to put Foreign Pension income in Other Miscellaneous Income is not how the IRS wants it to be filed. It may allow you to submit the return but is not the correct way and it causes problems with State Returns. 1) It does not classify the income as retirement income in State Returns. Many of us live in States where this is required in order to get retirement income exemptions, property tax exemptions sometimes worth thousands. 2) Some report issues with Foreign Tax credits using this method.
5) Professional tax programs do not have this artificial limitation, and TaxAct consumer edition does not have this limitation. I can simply fill out the Foreign Pension Income, identify the country and it puts it in correctly with the appropriate supporting statement.
So, Why does TurboTax continue year after year ignoring this problem? As I will have Foreign Pension income for the rest of my life, and I don't want to use a HACK to file my taxes... looks like I will have to move on to TaxAct instead. I tried and tried. Maybe TurboTax will get the message one day. Until then...
