26 C.F.R. § 521.110
Under Article X (1) of the convention any wage, salary, similar compensation or pension paid by the Government of Denmark or by any other public authority within Denmark to an individual in the United States is exempt from Federal income tax for taxable years beginning on and after January 1, 1948. By reason, however, of the application of Article XV (a) of the convention, such exemption does not apply to recipients of such income who are either citizens of the United States or alien residents therein. As to the taxation generally of compensation of alien employees of foreign governments, see section 116(h) of the Internal Revenue Code and § 29.116-2 of Regulations 111 (26 CFR 1949 ed. Supps. 29.116-2 ) [and § 39.116-2 of Regulations 118 (26 CFR, Rev. 1953, Parts 1-79, and Supps.)].
26 C.F.R. §521.110