U.s. International Social Security Agreements

You can also write to this address if you want to propose negotiating new agreements with certain countries. In developing its negotiating plans, the SSA attaches considerable importance to the interests of workers and employers who will be affected by potential agreements. The agreements also have a positive effect on the profitability and competitive position of companies operating abroad by reducing their business costs abroad. Companies with staff stationed abroad are encouraged to use these agreements to reduce their tax burden. International social security agreements, often referred to as “totalization agreements,” have two main objectives. First, they remove the double taxation of social security, the situation that occurs when a worker from one country works in another country and is required to pay social security taxes to the two countries with the same incomes. Second, the agreements help fill gaps in benefit protection for workers who have shared their careers between the United States and another country. The agreements allow sSA to add U.S. and foreign coverage credits only if the worker has at least six-quarters of U.S. coverage.

Similarly, a person may need a minimum amount of coverage under the foreign system to have U.S. coverage accounted for in order to meet the conditions for granting foreign benefits. The International Association for Social Security (ISSA) is creating a database on international social security agreements. A first step includes information on existing social security agreements, including contracting states, the effective date, the duration of the reference period for seconded workers, the duration of insurance for the self-employed, the types of social security branches covered, as well as other references and links. In a second phase, the database will contain information about the operation. Despite the fact that the agreements aim to allocate social security to the country where the worker is most attached, unusual situations occasionally arise, where strict enforcement of the rules of agreement would result in unusual or unjustified results. For this reason, each agreement contains a provision allowing the authorities of both countries to grant exemptions from the normal rules if both parties agree.

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