asking for a friend who is waiting for internet.He receives a pension? from the company he worked for .Its actually a pre-pension as when he turns 65 this stops and he get his pension from the dutch and his employer.We are trying to figure out how he reports this on the 1040.
We know to put it on line 16a but we can't figure out what the taxable amount is.
Found out in Pub 54 that pensions are considered unearned income so he can't use the FEIE.
So is he stuck with the whole tax burden?
He pays37.5% tax on this pension.
Can he use the tax credit to lower his tax burden?
What he is getting is like a salary and he stays home to get it.
Its kind of confusing to explain what it actually is.
Can he just claim it as income?
Any help solving this would be greatly appreciated.
Thanks in advance for the help.
Bernie
We know to put it on line 16a but we can't figure out what the taxable amount is.
Found out in Pub 54 that pensions are considered unearned income so he can't use the FEIE.
So is he stuck with the whole tax burden?
He pays37.5% tax on this pension.
Can he use the tax credit to lower his tax burden?
What he is getting is like a salary and he stays home to get it.
Its kind of confusing to explain what it actually is.
Can he just claim it as income?
Any help solving this would be greatly appreciated.
Thanks in advance for the help.
Bernie