Internal Revenue Service United States Department of the Treasury
Level Basic Advanced Military International

Foreign Tax Credit and Completing Form 1116

Completing Form 1116

Part I (continued)

Line 1a: Pension Income

Taxpayers who receive pension income(passive category income) for work performed partly in the U.S. and partly in Puerto Rico or other foreign countries, must calculate their foreign source income amount using the formula:


Number of years in foreign country

 

  X   Annual distribution (pension)
       attributable to contributions   =   Foreign Amount

  Total years of service for the pension