Voluntary Contributions into Foreign Pension Fund - Is this reportable to IRS?

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petrisunset
Posts: 37
Joined: Sat Feb 28, 2015 4:02 pm

Voluntary Contributions into Foreign Pension Fund - Is this reportable to IRS?

Post by petrisunset » Wed Jul 24, 2019 11:58 am

Hi BH,

I am voluntarily contributing after tax-money into a pension fund in Germany (worked there in the past). I am aware that any future retirement income derived from this pension fund will be taxed in the US (I am US-citizen) and most likely a Windfall Elimination Provision will be applied to my US-social security once I apply for retirement.
What I can't find an answer on is whether I need to report this voluntary contributions in my annual US tax return? Can anyone please help me here or guide me to an expert in this field?

Thanks a lot.

trueblueky
Posts: 1621
Joined: Tue May 27, 2014 3:50 pm

Re: Voluntary Contributions into Foreign Pension Fund - Is this reportable to IRS?

Post by trueblueky » Wed Jul 24, 2019 9:25 pm

A tax treaty between the US and the other country may apply. The American Embassy in the other country would be a place to call.

crre
Posts: 40
Joined: Fri Apr 12, 2019 8:07 pm

Re: Voluntary Contributions into Foreign Pension Fund - Is this reportable to IRS?

Post by crre » Thu Jul 25, 2019 11:46 am

petrisunset wrote:
Wed Jul 24, 2019 11:58 am
What I can't find an answer on is whether I need to report this voluntary contributions in my annual US tax return? Can anyone please help me here or guide me to an expert in this field?
i've lived abroad for most of my working life, and over the years have used a number of accountants plus done my taxes myself in the years when they are simple. what i've found is that seemingly simple questions like yours do not always have clear-cut answers, and different accountants take different approaches.

here's what i have done: find a good accountant who specializes in expat taxes, and use them for at least one year. then, in subsequent years, if you decide to do your taxes yourself, just do what they did.

megabad
Posts: 2492
Joined: Fri Jun 01, 2018 4:00 pm

Re: Voluntary Contributions into Foreign Pension Fund - Is this reportable to IRS?

Post by megabad » Thu Jul 25, 2019 5:06 pm

petrisunset wrote:
Wed Jul 24, 2019 11:58 am
I am voluntarily contributing after tax-money into a pension fund in Germany (worked there in the past). I am aware that any future retirement income derived from this pension fund will be taxed in the US (I am US-citizen)
I do not have specific experience with this specific thing, but in my experience the above is only half the story. Typically, my foreign income would be taxed by the host company (Germany) and then also taxed by the US. If there is a tax treaty, you will only have to pay the agree upon rate. In practice, this means you have to fill out a form and request reimbursement from the host country. This process is typically a pain and slow. I suppose if the German taxes and with holding were zero, you would not technically have to remit anything to Germany so maybe that is your case.

I have no idea whether you should report contributions to a German pension in the US. I suppose the only reason you might would be the possibility of some sort of multi country agreement pertaining to retirement plans (that might allow a deduction). The only country I know of specifically is canada that does this, not sure about Germany.

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