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Lev
Lev, Tax Advisor
Category: Tax
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Experience:  Taxes, Immigration, Labor Relations
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Is there someone who can aswer a US tax question for me. I

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Is there someone who can aswer a US tax question for me. I receive a small $ pension from American company for whomI used to work. They deduct a UC NRA amount from the pension as I do not have a US address. The cheque is mailed to Mother in the UK who forwards it to me in Turkey where I am now a full time resident...The UC NRA withholding represents approx 30% of the pension amount. I would like to know whether I can get this UC NRA refunded and if so how. Many thanks.

LEV :

Hi and welcome to Just Answer!
Are you US citizen?

LEV :

Assuming you are NOT an US citizen - and are a nonresident alien - the general rule is - pension income related to past employment in the US is considered income from US sources and as such is taxable in the US.
However - because you are a resident of Turkey - you should be aware of the tax treaty between the US and Turkey which overrides the general tax law - see page 20 - http://www.irs.gov/pub/irs-trty/turkey.pdf - ARTICLE 18 Pensions and Annuities


1. Subject to the provisions of paragraph 2 of Article 19 (Government Service), pensions and other similar remuneration paid to a resident of a Contracting State in consideration of past employment, whether paid periodically or in a lump-sum, shall be taxable only in that State.


So far - US pension should be only taxed in Turkey and should not be taxed in the US.

LEV :

What you need to do - provide a signed form W8BEB to the payer and mention that paragraph of the tax treaty as an exclusion from ANY withholding.
Here is the form to print - www.irs.gov/pub/irs-pdf/fw8ben.pdf

LEV :

To claim a refund for taxes that were already withheld - you need to file a tax return as a nonresident - form 1040NR - www.irs.gov/pub/irs-pdf/f1040nr.pdf and claim pension income as not taxable based on the tax treaty I referenced above.
Let me know if you need any help or clarification.

Customer:

I think this is the best response I have ever received from a Just Answer lawyer in the 2 or 3 years that I have been using this service. Anyone who is lucky enough to have you respond to their question is getting incredibly good value for their money! I do hope that you can bring my comment to the attention of senior executives within the company that owns Just Answer..Many thanks. TM

LEV :

Appreciate your warm words.
Just want to let you know that I am NOT an attorney and not a CPA - but I do tax preparation.
My goal is to provide EXCELLENT service - and I will address all your concerns and tax related issues. Please feel free to ask for clarification as needed.

LEV :

You may also review my other answers - http://www.justanswer.com/finance/expert-lev-tax/questions.html

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