How do I report foreign pension income? A year ago it got added as "other income" to schedule 1 but I have no recollection how it landed there.

[ThomasM125]

It would be best to report foreign pension income as if it was reported to you on a Form 1099-R like you do with domestic pension income. Since you don't have such a form, you need to prepare a substitute Form 1099R as follows:

1. Find the Retirement Plans and Social Security menu option
2. Start or Update IRA, 401(k), Pension Plan Withdrawals (1099-R)
3. Choose Add (Another) 1099-R
4. Choose I'll type it in myself 
5. On the screen that says Tell Us Which 1099-R You Have choose I need to prepare a Substitute 1099-R

Then, complete the Form 1099-R pension income entries.

A less optimal method of reporting it would be to enter it as "Other" income as you mention, as follows:

1. From the Federal menu in TurboTax find Wages and Income 

2. Find Less Common Income

3. Choose Miscellaneous Income, 1099-A, 1099-C

4. Choose Other Reportable Income

The problem with this method is you may be entitled to a pension income exclusion on your state return which will be hard to achieve when you report the pension income as other income.

[neptunes]

A substitute does not work because the form is stuck where it asks the payer's I.D.  Foreign Governments do not have this id and turbotax will not file unless this box is filled with an acceptable number.

[MarilynG1]

 Yes, for a Foreign Pension it is best to report as Other Income due to the lack of an EIN number, unless you want to mail your tax return. 

Your State most likely doesn't exclude Foreign Pension Income, although you can check with your State Dept. of Revenue to verify that.

1.  From the Federal menu in TurboTax find Wages and Income 
2.  Find Less Common Income
3.  Choose Miscellaneous Income, 1099-A, 1099-C
4. Choose Other Reportable Income
5. Enter description as Foreign Pension, and amount

@neptunes 

[Dacijack]

Where do you report the taxes you paid on the foreign pension? My wife receives a pension from Brazil.

[MarilynG1]

Yes, you would report the Foreign Pension Income in the Wages & Income section.  Scroll all the way down to 'Miscellaneous Income, 1099-A, 1099-C', then on the next page all the way down to 'Other Reportable Income.'

Under 'Other Taxable Income', enter a description and amount.

In the Deductions & Credits section, under 'Estimates and Other Taxes Paid', choose 'Foreign Tax.'

The first few screens are asking about Foreign Tax paid on 1099-Div or 1099-Int.  Continue until you reach a screen asking if you have other types of foreign income to report.  Choose 'General Category Income'  and Continue.

You'll enter the amount of your pension again, as well as the amount of foreign tax you paid.  You aren't being double-taxed, this is linking the income/tax amounts for calculations on Form 1116.

Here's more info on Claiming the Foreign Tax Credit.

@Dacijack 

[Ralf1]

Hello Marilyn,

This is useful. I have a follow-up question.

I have a foreign (private and company) pensions that is not taxed abroad (according to double tax treaty) as it should be taxed at federal level in the US but no state level in Illinois, where I live, and wonder how to report this. Following your instructions above, assuming these are the instructions for this situation.

Under 'Deductions & Credits' under 'Other taxes paid' under 'Foreign Tax Credit', it provides three choices:

1) 'I paid foreign taxes on income I earned while working in another country',

2) 'I have foreign tax credit carryover that I want to use' and

3) 'None of these apply' 

Should one choose number 1 above? If so, on the next screen, should one choose credit or itemized deduction? 

Rick