Hello, I appreciate all the clarifying answers I can get.
Back in 2000 I started contributing to a Foreign
Insurance Company to their so called Pension Builder.
This the Philamlife Insurance Company Pension Builder
in the Philippines. I was contributing about $600.00 (32k pesos)
yearly and after 10 years it reached maturity and I just
got my first distribution of $1100.00 (50k pesos) last year
Dec 2010. The account itself supposedly has a face value
of roughly $10k-11k (500k pesos).

Now how do I report the distribution in my 2010 Income tax.

1) Report the interest of $500 in schedule B?
2) Report this as Pension or Annuity Income?

The bottom line is I am not sure. I am also confused on
how to classify this type of Account, whether this
some sort of deferred annuity or just a high interest
savings account?

Thanks for all the help.

I do not think it is a pension distribution. The distribution would be considered either interest or dividends, plus perhaps a partial repayment of principal which is NOT axable.

You need to get the company to identify what the distribution was for tax purposes and how much was a repayment of principal. Otherwise, you MAY have to claim it ALL as dividends.

Hello. Thanks for a response. I did contact the Philamlife and they told me that is
some form of pension benefit doubling as a Life Insurance with a cash surrender
value of around 360k Pesos ($8732) currently. Also I did some researching and
it seems that the account takes the form of some kind of Fixed Annuity Insurance.
For my part I will be using the IRS General Rule for computing taxes for non-qualified
Pensions or Annuities for this Foreign Fixed Annuity plan. Further research tells me
that foreign annuity plans are not tax-deferred therefore I am exempt from the 10%
tax penalty for pension annuity distributions withdrawn before age 59. And then
this thing opens up a can of worms regarding taxes on the earnings per year
ever since I started this account back in 2000. Also there is the issue of
FBAR filing of Life Insurance with Cash Value just recently put out by
FinCen. I am not really sure if I I have to file this form to the Treasury
with cash value is below $10k.

Thanks for the response. See my Answer below.

In my opinion, the $10,000 threshold applies for the Life Insurance with cash value, so no FBAR is necessary.