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Returning Member

Upon retirement, 25% of the pension can be withdrawn tax-free in the U.K?

I became a permanent resident of the US in 1998 which is my home. I have been using Turbo Tax for my returns for the past 15 years but am beginning to wonder if I can continue as I move into retirement. I am just reaching 65 and want to claim my UK Personal Pension. Under UK rules I can take 25% of the plans value tax fee and will probably put the rest into an Annuity.  Clearly the regular Annuity payments will be taxable in the US but excluded from UK tax becasue I will fill in a Form US Individual which both the IRS and HM Revenue and Customs complete.  I think I can see how to report the UK pension as revenue, but have two related questions which I cannot see how to do:

[1] Do I need to report and if so how, the Annuity as a fund, since its not a fund I get viability of I am unsure what might need reporting?

[2] The 25% lump sum appears to be free of tax? I see language that suggest:

"Under the Articles 17 and 18 of the tax treaty for U.S. residents with U.K. pensions generally, all U.K. pension distributions paid to a U.S. resident are taxable in the U.S. and only by the U.S., except: Any amounts that would’ve been excluded from tax in the U.K. had that person remained a U.K. resident, would also be excluded from U.S. tax."

If this is the case do I even need to report that income on my return?