I get the total balance of my foreign pension plan (built while I was a nonresident of the US). Where should report it in Turbotax?

[dinasalazar69]

I know the income is taxable, but I need to know the correct section to include the income and if there is a deduction that I could use for that type of income.

[TomK2023]

To report a Foreign Pension in TurboTax follow these steps:

1. Open your return.
2. Select the Wages & Income tab.
3. Scroll down to Less common income click Start.
4. On the page Let's Work on Any Miscellaneous Income, click on Other reportable income.
5. On the page Any Other Taxable Income?  Select Yes.
6. On the page, Other Taxable Income enter "Foreign Pension" for the description and the amount.
7. Select continue and Select Done if you have no other items.

If you paid or accrued foreign taxes to a foreign country or U.S. possession and are subject to U.S. tax on the same income, you may be able to take either a credit or an itemized deduction for those taxes.  Both the credit and the deduction are entered in the same place. 

Enter Foreign Tax Credit (Form 1116) or Deduction:

1. Open (continue) your return in TurboTax
2. Enter all your foreign income in Wages & Income if you haven't already
3. Select Search, enter foreign tax credit and select Jump to foreign tax credit
   • Or go to Deductions & Credits, and select Start  next to Foreign Tax Credit under Estimates and Other Taxes Paid
4. When you reach the screen Do You Want the Deduction or the Credit? select the option you prefer for your situation
5. If you select Take a Credit:
   • Select Continue on the next screen, then select No to fill out Form 1116
   • When you reach the screen Country Summary, select Add a Country
   • Answer the questions about your foreign income, taxes, and expenses on the following screens
   • When finished, you'll be taken back to the Country Summary screen. If you have income from other countries to enter, select Add a Country. Otherwise, select Done
   • Answer the questions on the following screens until you reach your Foreign Tax Credit Summary. If you’re finished with this section, select Done
6. If you select Itemized Deduction:
   • Enter your foreign taxes paid on the next screen. These should show up in the Deductions & Credits section of your tax return, under Other Deductible Expenses

In most cases, taking the credit works out better than the deduction. We'll help you decide which one's best for you when you go through this section.

If you choose to take the credit (most people do), we'll attach Form 1116, Foreign Tax Credit, if your situation requires it.

TurboTax FAQ: Where do I enter the foreign tax credit (Form 1116) or deduction?