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Is a UK DWP spousal bereavement benefit taxable in the US?
My husband was a dual UK-US citizen and was receiving the UK state pension and other private UK pensions. I have never lived in the UK; I am a USA citizen, residing in the USA. Upon his death, I received a one-time bereavement payment and twelve months of small monthly payments. These payments do not appear to be taxable in the UK. I claimed them on my 2021 tax return but now am having to amend my 2021 return and am wondering whether I can remove this from my amended return? The tax treaty and related documents are complicated and confusing, but a general principle seems to be that if a payment is not taxable in one state, it should not be in the other. Can anyone advise on this?
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‎April 17, 2023
11:11 AM