Thank you for asking this question. Please note from the outset that
this answer does not address the tax treatment of your (foreign) Social
Security or pension income, from the perspective of any other country
aside from the United States. It also does not consider any tax treaty
provisions that may be in effect between the US and the United Kingdom.
In other words, the scope of this answer is restricted to the US tax
treatment and reporting of these items only. Any taxes due or forms
required by the other country involved are beyond the purview of this
response.
That said, there are some good
existing answers on this very topic (foreign pension income, that is),
on a few of the other TurboTax
AnswerXchange threads. They provide mechanical instructions for
entering foreign pension income into TurboTax (and thus onto a US tax
return). Here are those links, so that you can read them for yourself:
https://ttlc.intuit.com/questions/3175138
https://ttlc.intuit.com/questions/3642520
https://ttlc.intuit.com/questions/3833087
Essentially those answers propose one of two different
solutions. Under one method you can input a foreign pension or non-US
Social
Security payments into TurboTax (and
thus report them on a US tax return), by creating a "substitute" Form
1099-R. It does not matter whether the income was a one-time lump sum
payment, or an annual (ongoing) pension stream of monthly payments. It
still gets reported, and
taxed, the same.
Alternatively (and also preferably as well, because it is easier to do), you can enter the foreign pension
income on Form 1040, Line 21 as "other income" or "foreign pension." If
you choose this way, then you won't have to create a substitute
Form1099-R, by filing Form 4852.
However, the end tax result (in
terms
of United States tax rate and amount assessed) will be identical under
both methods. You can enter a Line 21 amount in TurboTax by using the
following pathway Federal Taxes -> Wages & Income -> Less Common Income -> Visit All
and then proceed through the interview until you find an appropriate
place to declare the foreign income and type in an accompanying
description.
Thanks again for asking about this.
