No, don't report this under miscellaneous income. Please use the steps provided in this Turbo Tax link as it is very detailed on how to report this. I am not sure what you mean by "reducing the benefit" unless the amount was not paid in US dollars. You would need the US dollar equivalent of your pension to report the distribution so that you are taxed in US dollars. Hopefully this is what you are asking.
Also, if you paid foreign tax and if that country has a tax treaty in the United States, report the foreign tax paid to avoid double taxation.
To enter a foreign tax credit on form 1116, go to:
1. After sign into your account, select Take me to my return
2. At the right upper corner, in the search box , type in foreign tax credit and Enter
3. Select Jump to foreign tax credit
4. Start with screen Foreign Taxes and select Continue to follow prompts.
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