Foreign Social Security

[S&D Associates]

Where on Federal return do you enter foreign social security? On Social security worksheet? My understanding it's not treated the same way>

[ATSMAN]

Where on Federal return do you enter foreign social security? On Social security worksheet? My understanding it's not treated the same way>

I have one client that gets around $2000 in foreign pension and I put it on line 21. You are correct that the rules that apply to SS don't apply to foreign pensions.

There is a foreign tax withheld on that income so we file a form 1116 for that.

[Gretel]

Foreign SS

Foreign SS and foreign pension are two different things, just like in the US. Treatment depends on treaty with that foreign country. F.e. German SS is treated the same as US SS, only taxable if too much other income.

[TAX4US]

Gretal, Do know about Japan Social Security?

[TaxGuyBill]

Enter it as a Pension.

Foreign Social Security Pensions
Most income tax treaties have special rules for social security payments. In many cases, foreign social security payments are taxable by the country making the payments. Unless specified otherwise in an income tax treaty, foreign social security pensions are generally taxed as if they were foreign pensions or foreign annuities. Unless a tax treaty allows it (see, e.g., the USA-Canada treaty), they are not eligible for exclusion from taxable income the way a U.S. social security pension might be.

https://www.irs.gov/businesses/the-taxation-of-foreign-pension-and-annuity-distributions

A quick glance seems to indicate only German and Canadian Social Security are eligible for the US tax-treatment of Social Security of being only partial taxation.

Canadian or German social security benefits paid to U.S. residents.

Under income tax treaties with Canada and Germany, social security benefits paid by those countries to U.S. residents are treated for U.S. income tax purposes as if they were paid under the social security legislation of the United States. If you receive social security benefits from Canada or Germany, include them on line 1 of Worksheet 1, shown later.

https://www.irs.gov/publications/p915#en_US_2017_publink100097884

There doesn't seem to be any special rules for Japanese Social Security:

https://www.irs.gov/pub/irs-trty/japante04.pdf#page=71