Korean National Pension & Severance Pay — Do You Owe U.S. Taxes?

Korean Income and U.S. Tax Obligations

U.S. permanent residents and citizens must report worldwide income to the IRS. This includes Korean national pension and severance pay received from Korea.

U.S.-Korea Tax Treaty

The U.S. and Korea have a tax treaty to prevent double taxation, so you generally will not pay full taxes in both countries.

National Pension (NPS)

Taxes withheld in Korea may be claimed as a Foreign Tax Credit on your U.S. return, offsetting your U.S. tax liability.

Severance Pay

Lump-sum severance payments must be reported as income in the year received. IRA rollover strategies may help reduce your tax burden.

For complex U.S.-Korea cross-border tax issues, consult with a TPT Tax professional today.