SlashDevSlashNull

I spent the last few hours reading on this topic here. It is as clear as mud. I didn't find anyone with exact situation
if you can provide some direction, that would be great.

I am 45 old and moved from the UK to the USA 4 years ago. I have around 50K in UK pensions and no plans to return to the UK.
1) Last few years my tax consultant never advised on filling FBAR for this. I am planning to declare UK Pension this year. Will there be any issues? What's the right way to this?
2) How much tax I need to pay If I want to take the lump-sum option? First, is this possible? Few folks in this forum mentioned 25% and others mentioned 35%. If it is 25%, does it mean that I can draw 37.5K? What are the US & UK tax implications?
3) Is it advisable to draw my UK pension and pay towards the mortgage in the US?
3) Can you recommend any pension & tax expert?

Any advice or pointers greatly appreciated.

Pulaski

If you're 45 I believe that your UK pension savings are untouchable for the next ten years i.e. until you're 55, unless the pension resulted from work in one of the occupations that permit retirement at an earlier age, which includes many professional sports, but also certain high risk and arduous occupations, such as deep sea diving.

Cook_County

You would already have been reporting the pension plan(s) on Form 8938. Most UK pension plans are FBAR reportable. If these obligations were omitted, the SDOP is the cheapest way to deal with any omissions.

Pulaski

If he's not been filing FBAR, why would you assume he's been filing Form 8938?

Perhaps you don't realize, but most of your terse posts might as well be in Greek. You never give any explanation or context, or guidance on how to complete the forms, you just fire off a few words, which are as likely as not of very little practical use to the person who asked the question!

MidAtlantic

If your tax returns are in order, the IRS has a procedure for the filing of delinquent FBARs without any risk of penalty: https://www.irs.gov/individuals/inte...ion-procedures

Glasgow Girl

"If he's not been filing FBAR, why would you assume he's been filing Form 8938?

Perhaps you don't realize, but most of your terse posts might as well be in Greek. You never give any explanation or context, or guidance on how to complete the forms, you just fire off a few words, which are as likely as not of very little practical use to the person who asked the question!"
__________________
I agree. Frequently these posts appear to be designed to deliberately terrify the original OP and force them down the SDOP path which is expensive and inappropriate in most cases. Hopefully that is not the case, but that is how they come across.

Assuming there is no income from these pensions in prior tax years and therefore no delinquent tax, then I would simply file the delinquent FBARs for each of the missing years with a note that explains why you did not file them prior. The electronic FBAR system allows you to do this. If you have not filed Form 8938 (thats the one that you are supposed to file as part of your tax return) then I would modify the past 3 years tax returns to add those Forms (3 years is the most you can modify) and again provide an explanation. If you have only been here for 4 years then that will likely cover all of your tax returns anyway.

.Unless you have other tax issues, it is unlikely you will ever hear back from the IRS and you can move on with your life. The FBAR and Form 8938 are not hard to fill in, if you pay attention to the instructions and detail. It is a tedious task, but very doable, and many of us have done so without paying an expensive professional international “expert". If you need help refilling your back taxes then a regular tax preparer should be able to assist with that, if you provide the data required for Form 8938.

robin1234

I suspect he/she does realise that. But, there’s a lot of weird shit in BE.

Pulaski

And a few trolls.

robin1234

Them too...

SlashDevSlashNull

Thanks for all your helpful pointers.

Steerpike

In the US, if you have money in a tax-sheltered retirement ('pension') account, like a conventional IRA or 401K, you don't have to worry about any tax consequences of any gains the funds within the account make; it's only when you withdraw that you have to do that. But if you have money in a UK pension, do those same rules apply (when filing your US tax return)? When you say 'no income', I presume that means 'no withdrawals', and not 'no gains'. I thought I'd read somewhere that UK pension plans were not subject to the same exceptions as 401k's and IRAs. Just curious.

durham_lad

UK pension plans such as a SIPP or employer defined contribution plan are treated similar to a 401k or IRA in that the gains are not taxable. Only on withdrawal are they taxed by the IRS. The balance of the pension plans are reportable following the rules of FBAR and the IRS form 8938.

mv72

Greetings all!

I thought I'd reply on this topic as it is somewhat relevant I was doing a bit of research, I am US based but have an old UK workplace pension that has a small amount and a UK bank account the combined amount of the two accounts is probably under $6k. I don't own any property or have any other financial accounts etc other than those two.

From what I read on here I would report both on the FBAR if the max values of each account throughout the year when combined exceeded $10k? There was another form 8938 but I believe you report that if the value of the accounts exceeded $50k at any time during the year or $100k if married filing jointly?

Does that sound right that those two would apply only when the filing values for each type are met?

durham_lad

Sounds like you have it right.

mv72

Thanks, I re-read the 8938 again and actually when married filing jointly and residing in the US that it is greater than $150k at anytime or $100k on the last day.

I guess with no deposits or activity in my dormant accounts that I don't need to file these until I meet the $10k fbar or $100/150k 8938 filing values.