I’m confused by the varying information being posted about the the US tax liability of the payment of UK government Pensions paid to US Residents / Citizens. Different people seem to read article 17 and deduce different answers, so perhaps we can ask for the answer from those that have successfully filed.
If I may I would like to address the following situation:
- Full time residents / citizens receiving SS for both partners.
- UK government paid to both partners based on working contributions prior to moving to the US.
- Previous UK employer pension paid to 1 person
- US tax Basis, married filing jointly.
- UK basis no tax deducted from any pension.
- UK pension amounts declared to SS.
Depending on which opinion you read, article 17 is designed to avoid being taxed twice (UK+US) but I suspect most people interested in Article 17 pay no UK tax because of the amounts being below any UK tax threshold and or non-residency.
So, the questions are:
- Is a UK government pension not taxed in the UK subject to US tax liability or excluded under article 17?
- Does the same answer apply to private UK pensions (contributions from employee and employer?
- How is the pension correctly reported in Turbo Tax?
Where can you download a copy of article 17?
