Just started receiving a retirement pension from the British Army. Someone suggested IRS form 8833, so that it would not be taxable.
Is this correct? How do I complete this form?
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You can enter your Foreign Pension either by creating a Substitute 1099-R or entering it under Miscellaneous Income.
If you also paid Foreign Tax on that income, please see the following steps from @TurboTaxKarenJ:
To report the foreign tax paid on your pension for foreign tax credit:
Form 8833 would not apply in this case, but click this link for dertailed info from the IRS.
I have a Candian Forces Pension. In the past, I have entered this as Foreign Earned Income. Is there a reason you are suggesting Substitute 1099-R?
It is not foreign earned income. However, you can input it as other miscellaneous income and then enter the amount in the foreign tax credit section of TurboTax.
Some states will exempt a certain amount of retirement income for their taxpayers. If you live in a state that exempts some or all of it, you would want to indicate on the federal return that it is retirement income.
Do you know if a Canadian Forces Pension is considered a "Qualified Plan" or "Non-Qualified Plan"? Thanks
Treat it as a non-qualified plan, the same that U.S. military pensions are treated.
The term "qualified plan" refers to pensions that meet the requirements of Internal Revenue Code Section 401(a) of the Internal Revenue Service (IRS) and is thus eligible to receive certain tax benefits, unlike a non-qualified plan. As a foreign government pension, a Canadian military pension would not comply with U.S. tax code.
Awesome. Thanks!
I have a Canadian Forces Pension. If I decide to use a Substitute 1099-R for Canadian Forces Pension (see chain below) what would I put in Box 7?
Previously you had reminded me this is not earned income and in Georgia there is an advantage to note retirement income.
Thanks so much 🙂
Box 7 would be code 7 for a normal pension distribution. For more, see page 13 of About Form 1099-R, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans.
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