Have a Tax Question? Ask a Tax Expert
Per the tax treaty between the US and the UK, any pension monies you receive are taxed only to the country in which you live at the time of receipt. So even though your pensions are from UK sources, you will pay US tax on them and not reported to Inland Revenue.
If you don't pull any money out of the pension accounts, then you don't have any income.
Your answer unfortunately refers to the drawing of funds from pensions when retired, but what I am asking refers to the new tax rules in the US where you have to report foriegn assets to the IRS which seems to include pensions even if you are not retired and not drawing income from them. I am looking for for a detailed explanation as to whether I have to declare these and what happens if I dont?
Any person who is liable to file a US return must file a FATCA report (form 8938) if their foreign assets exceed $50K on the last day of the year or $75K at any time during the year. If you are married, these numbers are doubled. Yes, this would apply to pension type accounts.
Keep in mind this is a reporting requirement and no tax is due no matter how much is reported.
Failure to file can result in penalties from $10K to as much as $50K (after the IRS has already warned you).