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Old Feb 10th 2010, 2:49 am   #1
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Default The IRS and UK state pension

I am having a very hard time trying to file my taxes in the US. There is no provision for filing a foreign social security pension. I can find forms for Canada, but nothing for UK. When I enter it on the tax form (electronic), the tax becomes enormous. Can anybody help here?

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Old Feb 10th 2010, 6:53 pm   #2
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Default Re: The IRS and UK state pension

What form (1040) and what line are you entering it on?
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Old Feb 10th 2010, 9:01 pm   #3
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Default Re: The IRS and UK state pension

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What form (1040) and what line are you entering it on?
I am using HR Block. Form is 1040. No problem entering the US Social Security, but there is absolutely nothing that covers the UK. When I tried to put it in, it was treated as an IRA Roth. What am I missing?

I very much appreciate your offer of assistance.
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Old Feb 10th 2010, 9:11 pm   #4
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Default Re: The IRS and UK state pension

My CPA enters my UK annuity on which I pay US tax on line 16 of the 1040.

A little while ago there was a thread on this as exvj was having problems. After much discussion and research the majority opinion was my CPA was right and it goes on line 16.

I know mine is an annuity but yours isn't US Social Security but a pension from the UK so I would enter it on line 16. It is after all called the State Pension and line 16 is for pensions and annuities. Were you entering it on line 20 for social security?
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Old Feb 10th 2010, 9:55 pm   #5
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Default Re: The IRS and UK state pension

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Originally Posted by lansbury View Post
My CPA enters my UK annuity on which I pay US tax on line 16 of the 1040.

A little while ago there was a thread on this as exvj was having problems. After much discussion and research the majority opinion was my CPA was right and it goes on line 16.

I know mine is an annuity but yours isn't US Social Security but a pension from the UK so I would enter it on line 16. It is after all called the State Pension and line 16 is for pensions and annuities. Were you entering it on line 20 for social security?
As a result of that thread I entered all our pensions, including the UK State Pension on Line 16 for 2009 filing. I used Turbo Tax to e-file it and it was accepted 24 hours later by IRS.

Last edited by Zonie; Feb 10th 2010 at 9:58 pm.
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Old Feb 12th 2010, 10:45 pm   #6
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Default Re: The IRS and UK state pension

Many thanks for your reply. Now, another problem. How did you calculate the taxable amount? I tried to follow the directions in the 1040 booklet page but they do not work for our pensions. Is the whole lot taxable?
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Old Feb 12th 2010, 10:49 pm   #7
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Default Re: The IRS and UK state pension

Quote:
Originally Posted by lansbury View Post
My CPA enters my UK annuity on which I pay US tax on line 16 of the 1040.

A little while ago there was a thread on this as exvj was having problems. After much discussion and research the majority opinion was my CPA was right and it goes on line 16.

I know mine is an annuity but yours isn't US Social Security but a pension from the UK so I would enter it on line 16. It is after all called the State Pension and line 16 is for pensions and annuities. Were you entering it on line 20 for social security?
Thank you for your help. But I am still puzzled as to how much of the pension is taxed. Do you happen to know that? You are probably wise to have a CPA do the work for you. I have followed the instructions for calculating this as given in the 1040 booklet, but it does not seem to work for a pension only, I suppose, for an annuity.

I called the IRS to ask about this and was told to tell the British government that they need to send out a form giving this information. Can't say I feel like doing that!
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Old Feb 13th 2010, 12:37 am   #8
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Default Re: The IRS and UK state pension

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Many thanks for your reply. Now, another problem. How did you calculate the taxable amount? I tried to follow the directions in the 1040 booklet page but they do not work for our pensions. Is the whole lot taxable?
Yes, it is all subject to tax. As to the calculations, Turbotax does that for you.
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Old Feb 13th 2010, 6:32 am   #9
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Default Re: The IRS and UK state pension

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Thank you for your help. But I am still puzzled as to how much of the pension is taxed. Do you happen to know that?
Are you paying any tax on it in the UK? If not it is all taxable in the US.

If you are paying tax in the UK you can claim that against US tax by filling out form 1116, I think that is the right number. However if you are paying UK tax on it and are now a permanent resident of the US you need to get it exempted from UK income tax
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Old Feb 13th 2010, 7:05 pm   #10
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Default Re: The IRS and UK state pension

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Yes, it is all subject to tax. As to the calculations, Turbotax does that for you.
Zonie, Thank you so much for your help. I will trust Turbotax to resolve this for me since my pension is not taxed in the UK.
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Old Feb 13th 2010, 7:06 pm   #11
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Default Re: The IRS and UK state pension

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Originally Posted by lansbury View Post
Are you paying any tax on it in the UK? If not it is all taxable in the US.

If you are paying tax in the UK you can claim that against US tax by filling out form 1116, I think that is the right number. However if you are paying UK tax on it and are now a permanent resident of the US you need to get it exempted from UK income tax
Lansbury, thank you for all the help you have offered. I do not pay UK tax since I have been out of the country for many years. So I will turn the problem over to Turbotax and see what they say.
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