My wife receives an retirement pension from Germany. She is living in the US and is a permanent resident with a green card. If we file US taxes as married, must I include her German retirement pension as income and pay taxes on it? I read something several years ago saying she was exempt from paying US taxes but I can not locate that information now. After reading the lengthy double taxation agreement between the US and Germany dated 1990, it appears that under article 19 that US taxes must be paid because she is a permanent resident, is that correct? If that is correct, do you know of any agreement/IRS rule that says each country will abide by the others mutual taxation laws and limits? The limit/threshold in which she would have to claim and file taxes if she were in Germany is for any amount over 18,101 Euro's (I believe). If she is required to pay US taxes I am looking for some agreement/law that allows that same high exemption since she does not make anywhere near that much; which means her retirement money is tax free.
Answer Since I am a German lawyer I cannot advise you on US tax laws. What I can say however is that the pension would be subject to German income taxation. Whether it is tax free in the US or whether it is subject to US taxes with the Option to deduct the German tax burden is something I cannot say.
I can answer questions in English, German and French. Practice in inheritance law, tax, labour and contract law for private clients. Services also rendered in the fields of business & commercial law; e.g. business organizations, contracts, debt collections, leasing law. Representing clients all over Germany. NO CONSULTANCY ON FAMILY AND IMMIGRATION LAW.
Working since 1999 in the forenamed fields. Henning Haarhaus` experience includes services in the legal department of Roedl & partner, the biggest tax consultancy firm of German origin. Appointed Bar Certified Tax Law Practioner in 2007.
Organizations Bar Association of Berlin, KIWANIS
Education/Credentials German licensed lawyer and bar certified tax specialist