Foreign Income - Foreign Pension or Foreign Social Security
If you received a foreign pension, you first must determine whether the foreign pension is taxable. TaxAct® has no process to determine this; please review the IRS links below to make this determination:
•United States Income Tax Treaties - A to Z
https://www.irs.gov/businesses/international-businesses/united-states-income-tax-treaties-a-to-z
https://www.irs.gov/businesses/international-businesses/japan-tax-treaty-documents
•IRS Publication 901 U.S. Tax Treaties ((( PDF file ))) --- Sept. 2016
•IRS Publication 54 Tax Guide for U.S. Citizens and Resident Aliens Abroad
Once you determine the amount of foreign pension that is taxable, there are two places you can enter the pension amount. In a few instances (based on treaties) the pension benefits can be entered as Social Security benefits. However, the most common place to enter foreign pension benefits is on the worksheet FEC Foreign Employer Compensation and Pensions.
To enter the foreign pension benefits in TaxAct on the FEC worksheet: