How am I taxed in Israel on my U.S. pension income and other passive income (dividends, interest, rents, pensions including Social Security)?
Israel generally taxes U.S. private pensions (such as IRA’s, 401k’s, corporate pensions, etc.) at the same rate that the pension would have been taxed had the taxpayer remained a resident of the U.S. According to the U.S.-Israel Income Tax Treaty, U.S. and State public pensions are taxed in the U.S. only. Tax on U.S. passive income is generally taxed in Israel after 5 years at rates between 10%-25%.
