How to report foreign pension income

1. FinCEN 114 (FBAR) if you held over $10,000 in foreign accounts, including your foreign pension plan, at any time of the year.
2. FATCA Form 8938 if your combined foreign accounts and assets are worth over a certain value.
3. Form 8621 if your pension qualifies as a PFIC.

Can you receive pension and Social Security?

There is nothing that precludes you from getting both a pension and Social Security benefits. If your pension is from what Social Security calls “covered” employment, in which you paid Social Security payroll taxes, it has no effect on your benefits.

Do you have to declare a foreign retirement plan?

Things are about to get somewhat confusing. But before that, most foreign retirement plans also need to be declared on a Report of Foreign Bank Account forms, the FBAR. That’s right, even though retirement plans aren’t bank accounts, the government takes a very expansive view.

Where does my retirement income come from abroad?

Retirement income from foreign sources can come from different kinds of accounts: A pension or annuity directly from a foreign employer. A trust established for you by a foreign employer. A payment from a foreign government or one of its agencies (this could include a foreign social security pension)

Can a foreign retirement plan be reported on the FBAR?

A foreign retirement plan is only reportable on an FBAR if it is associated with a segregated foreign retirement account, since it is the foreign account—not the plan itself—that triggers the obligation to file the FBAR.

What makes a foreign retirement plan a trust?

A donor entrusts a sum of money over to someone to invest it for them in a plan. So the same logic applies to foreign retirement plans. Underneath any labels, they are trusts at heart. Therefore, foreign retirement plans, as non-qualified plans, are treated as trusts, and the next step is to determine what type of trust it is.