is foreign pension income taxable
So, if you are earning $50,000 in salary and 15,000 in retirement benefits in France, the income reported on your U.S. tax return is $65,000. You might have foreign tax credits to offset the $50,000, but no credits to cover the $15,000.f course, if you are operating a small business, and your income is less than the Foreign Earned Income Exclusion ($99,200 in 2014), you donât need to be concerned with a pension, be it foreign or domestic. Now that Iâve buried the lead in the 5 th paragraph, letâs talk about the foreign pension tax trap.