brokenhearted.

Just wondered about those of you who have expatriated and have a pension provided by the US federal government etc. I have just read an article which states if you expatriate those pensions etc are gone. This doesn't seem to something anyone has mentioned before in any other article, publication or guide. Did I miss this ?

theOAP

durham_lad

+1

I know an ex US government employee in Yorkshire who is receiving his government pension to his UK bank.

I expect to have US SS pension paid directly to my UK bank, as I understand their exchange rates can't be beat.

theOAP

brokenhearted.

Will I lose my government benefits by renouncing US citizenship? Nomad Capitalist

I hope this is incorrect - as I am hoping to expatriate and still receive my survivor annuity which is provided via my deceased husband, who was a FAA employee and died in service. I will concede I am a LPR rather than a citizen. I am only expatriating because my husband ( the only reason I became a LPR was because of our marriage) is no longer here and my family and friends are all back in the UK. I really wanted to minimize the paperwork which expatriation will do.

brokenhearted.

Does the person receiving his government pension have US citizen status or did he expatriate - I expect US citizens would get there benefits but this article was more about government pensions being lost when expatriating

durham_lad

theOAP

In my opinion, and starting with the basics, according to research the pension plan for the FAA (Federal Aviation Administration) is FERS (Federal Employees Retirement System), or if a recent hire FERS-FRAE. Is this correct?

According to the IRS, a FERS plan is a qualified pension plan for IRS purposes. "The CSRS, FERS, and TSP annuities are considered qualified retirement plans."
https://www.opm.gov/faqs/QA.aspx?fid...2-eeaa58afee50

Although you may not be required to complete this section (resident less than 10 years, or not a covered expatriate?), according to the instructions for form 8854, Part IV, Line 7a, for Eligible Deferred Compensation - "Generally, a deferred compensation item is one of the following...... This includes a qualified pension,..."
https://www.irs.gov/instructions/i8854
The instructions then carry on to explain how even covered expatriates' Eligible Deferred Compensation is taxed, so the remaining after tax qualified pension benefit remains payable after expatriation to someone abroad. You will, of course, at all costs, attempt to not be a covered expatriate and therefore equally will have even less problems with the FAA survivors pension benefit being paid in the UK after expatriation.

Since this is a government pension, the special rules regarding residence and citizenship of country of residence in the US/UK tax treaty will come into play, which should mean the FAA survivors pension will only be taxed in the UK, if you are resident in the UK - Supposedly.

brokenhearted.

Thank you for all your replies. My husband died before claiming his pension ( he would have been retiring this month). He was a CSRS Offset employee. I became eligible for the survivor annuity the day after his death (26th Jan), the delay in receiving the monthly payments is simply down to OPM paperwork and processing time so is it fair to say the annuity is not deferred in reality? The OPM website advises that survivor benefit can be stopped if the widow/widower remarries before the age of 55 but it can be reinstated if the remarriage ends. This is not applicable to me as I am 55 but I would have expected to see a mention of expatriation at this point if it was another way to lose the annuity? The other thing I have since discovered is that the estate tax rules are used to the extent that the IRS look at it as though the person had died the day before expatriation and the tax refers to all assets that would be part of my estate - if that is true then surely the annuity doesn't come into play as it will die when i do?