Tax treaty-related matters are out of scope for our advice. Generally, the UK pension is taxable to the US. You would not file the Form 8833 Treaty-Based Return Position Disclosure However, some foreign pension might not be taxable if it is covered under any tax treaties between the foreign country and the United States. As it is out of our scope for advice, you are advised to consult a specialized professional for verification.
If the UK pension is not taxable to you,
- report your full amount as instructed below in the 1099R section. Then enter the treaty exempt amount as negative amount (e.g. -5000) under Other Reportable Income as instructed below.
- You cannot e-file. You may still use the TurboTax program to prepare all your tax forms, but you would need to print them out and submit by mail along with form 8833.
If it is taxable, to enter the UK pension, you will need to create a substitute form 1099-R.
Here are the steps:
In TurboTax online,
- Sign in to your account and select Pick up where you left off
- At the right upper corner, type in 1099r, then Enter
- Select Jump to 1099r
- Follow prompts
- Next screen, Choose your bank or brokerage, select I'll type it in myself
- Follow prompts. On the screen Tell us if any of these uncommon situations apply
- Check the box I need to prepare a substitute 1099-R and follow the prompts.
As to the Federal ID, UK pensions often do not have the ID number. Please try entering nine 9s. If electronic errors occur due to 1099-R data entry, enter the pension under Miscellaneous income, see instructions below. As long as the IRS has the pension reported and included in total income, it is not problematic.
- To your left, select Federal
- From the top, select Wages and Income
- Scroll down to last section -Less Common Income -select Miscellaneous Income, 1099-A, 1099-C- Start
- Next screen, scroll down to Other Reportable Income- Start
- Follow prompts
For more information, see http://www.irs.gov/Businesses/The-Taxation-of-Foreign-Pension-and-Annuity-Distributions
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