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Get your taxes done using TurboTax
It depends. If you are filing a US return as a US citizen, then you must report your world wide income. To report this in your Turbo Tax return, follow the directions that Turbo Tax agent Renee outlines in this Turbo Tax post.
To enter foreign pension in TurboTax online program, you will you would NOT treat it as "other income," rather, you will create a mock form 1099-R.
Within your Personal Tax section, Under Retirement Plans, select the IRA, 401(k), Pension Plans (1099-R).
- On screen, Your 1099-R, answer Yes and select Continue
- Next screen, Choose your bank or brokerage, select I'll type it in myself
- On the screen Tell Us Which 1099-R You Have, check the box I need to prepare a substitute 1099-R and follow the prompts.
If your foreign issue does not have an ID number, you can try entering nine 9s. If errors occur due to this entry, you can enter the pension under Miscellaneous Income. The following link provides the info for both entries:
Also if you paid taxes on your pensions in the UK, you can apply for a foreign tax credit since the US and UK have a treaty agreement. Here are the steps to take.
- Click on federal> Deductions and Credits at the top of the screen
- Select I will choose what I work on
- Scroll down to Estimates and Other Taxes Paid
- Select Foreign Taxes and then select start
- Select Yes to the question "Did you pay foreign taxes in 2021 or have credits to use from a prior year?" and then click on Continue
- Answer yes to the question that asks if you have already reported all your foreign income paid on interest, dividends or K1's.
- Continue past the next question and when you get to a screen that says Tell us About your Foreign Taxes, indicate none of these apply.
- Continue on until it asks you if you wish to take the deduction or credit. Here you will indicate you wish to take the credit.
- Continue until you reach a screen that says no other income or expenses, here you will answer no.
- Next screen will say completing forms 1116. Press continue.
- Continue at the Foreign Tax Credit Worksheet.
- Next question asks for the category type. Here you will indicate this is passive income.
- Country Summary. Here you will indicate this is Canada.
- Here you will enter the description of the income and the amount of the distribution.
- Continue through the next few screens until you are asked your foreign tax paid. Make sure you indicate this is other income.
- Answer the questions until you finish out this section.
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