Hello,
I’m a Naturalized US citizen. I migrated more than 22 year ago. I just received lump sum pension from my overseas life and work.
Please, how do I report this and if I have to pay any tax about it?
Thanks
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RUN to a tax professional or tax lawyer who is familiar with the U.S. tax treatment of pensions from your country. I say run because you might have a limited amount of time to avoid or defer paying tax on the lump sum, perhaps as little as 60 days. The options are different for different countries, and might depend on a tax treaty between the U.S. and the other country. This is not a do-it-yourself project. You need an expert with specialized knowledge. The expert that you consult will be able to tell you how to report the lump sum.
Thank you for the advice, I wonder if there is any of the professionals or services in TurboTax that can provide this guidance.
@CarlitosWay , while I agree with @rjs that professional help may be required (depending on your own familiarity with US tax regs on pension ) I would first familiarize myself with (a) tax treaty between US and that other country ; (b) source of the pension i.e. local govt. / social security equivalent in that country, private employer, providend fund or similar , annuity / insurance etc. . etc. etc. ); (c) your own contribution if any etc.
If you need more help on this , please consider providing the above details and I would be happy to help. Note that if you feel that this is not of general interest or otherwise do not wish to put info on this public board , you are quite welcome to PM me and I will come back. In any case , please NO PII ( Personally Identifiable Information).
pk
@CarlitosWay wrote:
Thank you for the advice, I wonder if there is any of the professionals or services in TurboTax that can provide this guidance.
@CarlitosWay TurboTax does not provide consulting or advice for this type of situation. pk, who replied above, is not a TurboTax employee (nor am I).
@CarlitosWay , my comments on the above response from my colleague @rjs :
1. I apologize that my colleague @rjs' answer seems to imply that us volunteers , while not employees of Intuit, have lesser knowledge about topics than tax professionals. On the contrary , most of the volunteers ( champs or otherwise designations ) are generally retired tax professionals or people with great familiarity with the product. We volunteer because we desire to help the " do-it-yourself" tax payer prepare and file an accurate tax return.
2. TurboTax product(s) is focused towards the DIY tax preparer , implying that if you have to run to a tax professional for your return prep. for each and every uncommon situation, then the product has failed ( either by design or otherwise).
3. Personally, having helped many TurboTax users over the years, I am convinced the product is quite capable of handling most complex situations. Your particular situation of foreign pension is not that uncommon and therefore the question becomes (a) is the product capable of handling the situation and (b) is the taxpayer ( with help from the community or otherwise) able to navigate and complete a correct return . My view is that the product is quite capable and so is the taxpayer i.e. the product ( the right version ) is capable and so is the taxpayer ( perhaps with help from the community ). Thus I vehemently disagree with my colleague ( @rjs ) that one must run to a tax professional for any such situation.
4. Additionally, just because one is a tax professional ( whether credentialed or not ) does not imply/ assure that one is conversant with international taxation ( in fact few are --- and I say this based on my experience with a number of CPAs / EAs while on advisory panels for the US treasury) .
In summary/ conclusion , my suggestions and statements above stand. I recognize that we , as volunteers helping TurboTax users, are not supposed to criticize post by a colleague -- this is an exception in my view.
Is there more I can do for you ?
pk
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