How are US traditional IRA withdrawals taxed after moving to Belgium in income year 2026 (assessment year 2027)?

A Belgian resident who withdraws money from a US traditional IRA should generally budget for Belgian taxation of the distribution under the progressive personal income tax scale, while US citizenship can keep a US federal filing layer in place. However, the Belgian classification of some US retirement accounts can be disputed, and the correct treatment depends on the individual facts and on how the account was funded.

The figures below are illustrative. The Belgian rates and thresholds mentioned apply to income year 2026 (assessment year 2027).

Belgian tax residence determines when Belgium can tax the IRA

A person who becomes a Belgian tax resident is, in principle, taxable in Belgium on worldwide income from the point at which Belgian residence begins.

For someone moving during 2026, the first Belgian resident return filed in 2027 will generally cover the Belgian-resident period ending on 31 December 2026. Income received before Belgian residence begins is therefore a key timing issue.

For married taxpayers, the analysis may require particular attention to where the household is established and where the taxpayer's permanent home and centre of vital interests are located. Where two countries could both regard the person as resident, the Belgium-US tax treaty may become relevant.

What the Belgium-US tax treaty says about pension-type payments

Article 17(1)(a) of the Belgium-US income tax treaty provides that pensions and other similar remuneration beneficially owned by a resident of one contracting state are generally taxable only in that person's state of residence.

For a Belgian resident receiving distributions from a US retirement arrangement such as an IRA, the treaty framework therefore points first to Belgium as the residence state.

Article 17(1)(b) adds an important rule: where an amount would be exempt in the source state if paid to a resident of that state, the residence state must also exempt it. This provision can become relevant for qualifying Roth IRA distributions.

US citizens remain a special case because the treaty's saving clause preserves the United States' right to tax its citizens as if the treaty had not entered into force. Double taxation must then be analysed through the treaty's foreign tax credit and re-sourcing rules.

How Belgium may classify a traditional IRA withdrawal

The central Belgian issue is not merely whether money is withdrawn, but how the IRA is characterised under Belgian tax law.

A Belgian Ruling Office decision discussed in the source analysis treated IRA payouts as pension income from an individually concluded retirement arrangement, comparable to third-pillar savings, unless the beneficiary had never obtained a tax advantage for the contributions.

That creates two possible analytical paths.

If the IRA is treated as a pension arrangement and the contributions benefited from tax relief, the distribution may be taxable in Belgium as pension income.

A more favourable argument discussed by Belgian practitioners is that the tax-benefit condition should be assessed from a Belgian perspective. Under that reading, contributions made and deducted only in the United States, before Belgian residence, may support a different Belgian treatment.

That point is not presented as settled law in the source analysis. For a material IRA balance, an advance ruling can therefore be important before the first significant Belgian-resident distribution.

Illustrative Belgian tax calculation for income year 2026

If the withdrawal is taxable as pension income, an early lump-sum distribution before Belgian retirement age should not be assumed to benefit from the special flat-rate or notional-annuity regimes that can apply to certain Belgian pension capitals.

The source analysis therefore uses the ordinary Belgian progressive rates for income year 2026:

• 25% up to €16,720

• 40% up to €29,510

• 45% up to €51,070

• 50% above €51,070

• basic tax-free allowance: €11,180

• plus a communal surcharge, illustratively around 6% to 9% depending on the municipality

Using an illustrative withdrawal of about $100,000, or roughly €86,000 at the exchange rate assumed in the analysis, the Belgian tax was estimated at about €36,000 including a 7% communal surcharge.

That is an effective Belgian burden of roughly 42% in the example.

The exact result depends on the exchange rate, other taxable income, family situation, municipal surcharge and, most importantly, the Belgian legal classification of the IRA.

Why the alternative Belgian classification also has consequences

A favourable argument that the IRA is not taxable as a Belgian pension vehicle does not automatically mean that the account becomes tax-neutral.

The source analysis highlights the opposite risk: if the IRA is not recognised as a pension arrangement for Belgian purposes, Belgium could in principle look through the retirement wrapper and tax income generated inside the account under the ordinary rules applicable to investment income.

That could potentially involve:

• the 30% movable income tax on relevant investment income; and

• for realised gains from 2026 onwards, the 10% Belgian capital gains tax on financial assets referred to in the source analysis.

The two Belgian characterisations therefore need to be compared as a whole. A taxpayer should not focus only on the tax treatment of withdrawals without considering the possible annual taxation of the assets held inside the IRA.

The US federal layer for a US citizen

A US citizen generally continues filing a US federal income tax return after becoming resident in Belgium.

Traditional IRA withdrawals remain ordinary income for US federal purposes. Where the same distribution is taxed in Belgium, the treaty's special foreign tax credit mechanics are intended to mitigate double taxation.

The source analysis therefore expects the combined income tax burden generally to gravitate toward the higher of the Belgian or US income tax burdens rather than simply adding both income taxes in full.

However, this does not solve every US charge.

The 10% US early-distribution charge before age 59½

Under the US rules cited in the analysis, a traditional IRA distribution made before age 59½ is generally subject to an additional 10% early-distribution tax unless an exception applies.

On an illustrative $100,000 annual withdrawal, that means a potential $10,000 additional US cost each year.

The analysis treats this additional charge as a separate cost that is generally not relieved by the Belgium-US treaty foreign-tax-credit mechanics.

One exception worth examining is a series of substantially equal periodic payments under section 72(t), commonly called a SEPP.

A properly structured SEPP can avoid the 10% additional tax, but it is rigid. The payments must follow the applicable IRS methodology and continue for the required period. Breaking the programme can trigger retroactive penalties.

For an illustrative IRA of around $1 million held by a person around age 50, the source analysis estimates that a SEPP might support roughly $35,000 to $60,000 per year, depending on the permitted calculation method and interest rate.

Why the timing before Belgian residence can matter

Timing is one of the most important planning variables because Belgium's worldwide-income taxation starts only once Belgian tax residence begins.

A distribution taken while the taxpayer is still outside the Belgian tax net can therefore have a different result from the same distribution taken after Belgian residence begins.

The source analysis identifies several planning questions to examine before the move:

• whether to build a pre-move cash buffer;

• whether a partial Roth conversion is appropriate before Belgian residence;

• whether a SEPP could cover part of the early-retirement cash needs; and

• how much should be withdrawn each year once Belgian progressive taxation applies.

These steps cannot be reduced to a single universal answer. They interact with US federal tax brackets, US state residence, Belgian residence timing, the IRA's Belgian characterisation and the taxpayer's expected spending.

Roth conversions before moving to Belgium

A conversion from a traditional IRA to a Roth IRA is a taxable event in the United States.

According to the source analysis, the conversion itself is not subject to the 10% early-distribution charge. This can make a pre-move partial conversion attractive where the US tax cost of the conversion is lower than the future Belgian tax that might otherwise apply to traditional IRA withdrawals.

The treaty point is especially important: Article 17(1)(b) can support Belgian exemption for a Roth distribution that would be exempt in the United States for a US resident, provided the US qualification requirements are met.

The source analysis specifically warns against assuming that a Roth conversion performed after Belgian residence begins has the same result. Belgium could potentially treat the conversion as a taxable distribution, so a post-move conversion requires a separate Belgian analysis.

Why smaller annual withdrawals can reduce Belgian progressive tax

If a traditional IRA distribution is fully taxable under the Belgian progressive scale, the annual amount matters.

For income year 2026, taxable income above roughly €51,070 enters the 50% bracket before the communal surcharge.

As a result, two moderate withdrawals spread over two tax years can produce a lower aggregate Belgian income tax burden than one large withdrawal concentrated in a single year.

The correct annual amount still depends on the taxpayer's full Belgian taxable income, cash needs and the result of the IRA classification analysis.

US state residence can create a separate tax layer

The source analysis also considers the risk of retaining domicile in a US state that continues to tax residents on worldwide income.

In the illustrative case, Colorado was relevant because its state tax could continue if the taxpayer remained domiciled there through factors such as a retained home, driver's licence, voter registration or an intention to return.

The analysis refers to a Colorado rate of around 4.4% and warns that the Belgium-US tax treaty does not bind US states.

The broader lesson is that a move to Belgium should include a separate review of US state domicile, rather than assuming that foreign residence automatically ends state taxation of retirement income.

Foreign-account reporting after becoming Belgian resident

A Belgian resident must generally report foreign accounts in two places:

• a first notification to the Central Point of Contact of the National Bank of Belgium; and

• the annual Belgian personal income tax return.

This can cover an IRA custody account and other US financial accounts maintained after the move.

The source analysis also notes the Belgian annual tax on securities accounts where the average value exceeds €1,000,000, at 0.15%, with an increase to 0.30% for reference periods from mid-2026 as stated in the source analysis.

Whether and how a particular US retirement account falls within the scope of that tax requires separate confirmation.

On the US side, ordinary US reporting can also continue, including the federal income tax return and, where the statutory thresholds and account definitions are met, FBAR and Form 8938 reporting for Belgian accounts.

What changes when one spouse is an EU official?

An EU official's salary can be exempt from Belgian income tax under the Protocol on privileges and immunities.

The source analysis also notes that Belgium may not use that exempt EU salary indirectly to increase tax on the other spouse's income.

However, the EU official regime does not automatically exempt the other spouse's IRA income.

The special tax-domicile fiction applicable to some EU officials and their non-working spouses also depends on the facts surrounding why the household moved to Belgium. It should therefore be analysed separately rather than assumed.

The source analysis further notes that the marital quotient may be unavailable where the other spouse's exempt EU salary exceeds the relevant statutory threshold.

Frequently asked questions

Is a US traditional IRA automatically tax-free in Belgium?

No. The source analysis treats Belgian taxation of traditional IRA withdrawals as the prudent base case where the contributions benefited from US tax deductions. A different treatment may be arguable depending on the Belgian characterisation of the account.

How much Belgian tax can apply to a $100,000 IRA withdrawal?

Using the income year 2026 scale and the assumptions in the source analysis, a withdrawal of about $100,000 was estimated to produce roughly €36,000 of Belgian tax including a 7% communal surcharge. The actual amount depends on the taxpayer's full situation.

Does Belgium also tax the IRA if the United States taxes it?

A US citizen can remain taxable in the United States because of the treaty saving clause. The treaty then provides foreign-tax-credit and re-sourcing mechanics designed to relieve double income taxation.

Does the US 10% IRA penalty disappear after moving to Belgium?

No. Moving to Belgium does not itself remove the US early-distribution charge before age 59½. An exception such as a properly structured section 72(t) SEPP may be available.

Is a Roth IRA better for someone moving to Belgium?

Potentially. The treaty contains a rule that can support Belgian exemption for qualifying Roth distributions that are exempt in the United States, but the conversion timing, US tax cost and Belgian treatment must be analysed before acting.

Is it better to withdraw before or after becoming a Belgian resident?

A withdrawal before Belgian tax residence begins can fall outside Belgian worldwide-income taxation, whereas a later withdrawal may be taxable in Belgium. The correct timing depends on the residence facts, US tax cost, state domicile and the intended Belgian treatment of the IRA.

Sources

1. Court of Justice of the EU, case law digest on the Protocol on privileges and immunities - https://curia.europa.eu/common/recdoc/repertoire_jurisp/bull_9/data/9_03_02_01.htm

2. Law of 3 June 2007 assenting to the Belgium US income tax convention of 27 November 2006 - https://etaamb.openjustice.be/fr/loi-du-03-juin-2007_n2007015104.html

3. Convention between the United States and Belgium, signed 27 November 2006, IRS text - https://www.irs.gov/pub/irs-trty/belgiumtt06.pdf

4. US Treasury, Technical Explanation of the Belgium US convention - https://home.treasury.gov/system/files/131/Treaty-Belgium-TE-7-11-2007.pdf

5. IRS, Publication 590-B, Distributions from Individual Retirement Arrangements - https://www.irs.gov/publications/p590b

6. National Bank of Belgium, Reporting foreign accounts to the Central Point of Contact - https://www.nbb.be/en/central-credit-registers/central-point-contact-accounts-and-financial-contracts-cpc-5

7. FPS Finance Belgium, Foreign income and bank accounts - https://fin.belgium.be/en/private-individuals/international/foreign-income-accounts

This article explains a general tax framework and does not constitute a personalised tax opinion. Tax rules, thresholds and administrative positions can change from year to year, and the correct treatment depends on the exact facts of each situation.

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