Is my foreign pension taxable in the US?
Foreign pensions are generally taxable in the US, but treaty benefits and local tax credits may reduce the bill. Learn reporting rules and PFIC traps inside pensions.
Most foreign pension distributions are taxable in the US as ordinary income, though tax treaties may allow you to defer taxation or claim exclusions until distribution. Employer contributions and growth in the plan are often taxed in the US unless a treaty specifically exempts them. Some foreign pension wrappers contain PFIC investments, which trigger Form 8621 reporting and punitive tax treatment under the excess distribution regime. You generally cannot roll a foreign pension into a US IRA. Report the income on your US return and claim the foreign tax credit for any local taxes paid to avoid double taxation.