Can I get confirmation that my interpretation of Tax treaty between Turkey and United States is correct

Forum|Forum|2 years ago
February 14, 2024
2 replies
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I am a dual citizen and State of CA resident

I have been receiving Social Security Survivor Benefit from my foreign dad's retirement benefit from Turkish Government's Social Secutity Administrartion. My dad had worked within government sponsored health care institutions (Hospitals/clinics).

The taxation treaty between Turkey and IRS seem to say that Social Security Benefits from Turkey is only taxable in Turkey and Turkish Government employee's income and benefits are also taxable only in Turkey.

Is there anyone who can look at the treaty and offer me clarificarions?

Not A Product Question

Best answer by AmyC

Thanks

So, you are confirming My Social Security Survivor benefit is not taxable by IRS? Please do say so in words

Given it is taxable by Federal Tax Board of California, do I need to ammend my prev year's taxes?

How come Turbotax did not ask me about this well known foreign SS income reporting difference as I preped my CA State taxes. So, my CA taxes would have been correct.?

Hope Turbotax software people are hearing me regarding this omission on their part.

For the previous years, can I file ammendments via Turbotax, assuming it could go back to 2019. Speaking of Turbotax desktop software, could anyone tell me how I will report this CA taxable income in the software.

Thanks in advance

Since Turkey is paying you, taxes are due to Turkey on the income, not the US government. CA was not a part of the treaty so they want your share as you are a resident there to help with that government

There are too many laws with minor variations for the program to ask everything This is considered a self prepared return and the responsibility lays with the taxpayer..

Amending returns for accuracy is always recommended.

To add the CA income, since your income is similar to pension, I would add it on the screen for pension adjustments. CA doesn't have a place for easy entry of foreign income not taxed by the federal. I think they should be happy you are adding it and will understand that this is the best solution available.

AmyC

Employee

Turkey - Tax Treaty Documents

ARTICLE 18 Pensions and Annuities does state:

Notwithstanding the provisions of paragraph 1, payments made by a Contracting State under the provisions of the social security or similar legislation of that State to a resident of the other Contracting State or to a citizen of the United States shall be taxable only in the first-mentioned State.

Article 19 addresses the government service, income and pension. The income would be taxable to a US citizen but not the pension. I don't believe you are receiving regular income.

This is all related to the federal government. CA does not recognize this tax treaty so it is all taxable to CA.

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MelsTTCAuthor

Thank you for giving me relevant articles from the tax treaty.

So, based on those articles, are you saying that monthly Social Security Survivor benefit from Turkey is not taxable by IRS. but it may be taxable by CA state?

Please confirm

Thank you

DaveF1006

Yes, that is correct. California is odd in the respect that some of its taxation does not conform to IRS taxation or Foreign Treaty provisions.

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AmyC

Employee

That was a great solution. You have the description and the amount, CA can't complain because they did not make it easy for you! Best wishes!

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MelsTTCAuthor

And best wishes to you.

I e-filed my 2022 amended return. Yet it had fallen into the black hole. Turbotax says they are accepted, FTB has no record of it.

I hope you have a way of checking when Turbotax will submit them?

AmyC

Employee

Your records say submitted and only FTB knows what they have done with them. If they don't show up eventually:

Contact FTB since they need to acknowledge the filing
If FTB claims it was never filed, you can contact support. prove who you are and they can give the DCN - a control number that proves when you filed and all the surrounding facts.
Then you call FTB and give them the DCN so they can locate you.
Give it some time.

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