Workers who have shared their careers between the United States and a foreign country may not be entitled to pensions, survivor benefits or disability insurance (pensions) from one or both countries because they have not worked long or recently enough to meet minimum conditions. Under an agreement, these workers may benefit from partially U.S. or foreign benefits on the basis of combined or “totalized” coverage credits from both countries. The single-family home rule in U.S. agreements generally applies to workers whose interventions in the host country are expected to last 5 years or less. The 5-year limit for leave for exempt workers is much longer than the limit normally set by agreements in other countries. Expats who work for a foreign employer are generally exempt from Social Security and Medicare from their salary. Instead, they contribute through the private employer of the country of residence scheme (i.e. the British National Insurance or the French Security Social or Singapore CPF). However, there is a difference in how credits can be used in the future for social benefits in the United States in the United Kingdom (countries with totalization agreements) and in credits acquired in Singapore (no totalization agreement). Since the late 1970s, the United States has established a network of bilateral social security agreements that coordinate the U.S. social security program with similar programs in other countries. This article provides a brief overview of the agreements and should be of particular interest to multinationals and people who work abroad during their careers.
Self-employed workers are also exempt from double taxation by two social security schemes. However, the country in which contributions must be defined differently depends on the source of income of social security, the duration of self-employment (extended or random income) and, for some countries, by nationality and not residence (i.e. Italian nationals contribute to the Italian scheme, while non-citizens residing in Italy contribute to the US social security system). To be sure that the country in which you will pay your contributions, be sure to inquire about the agreement that is (if any) between the United States and the foreign country in which you live and work. This agreement may be amended in the future by complementary agreements which, as soon as they come into force, will be considered an integral part of this agreement. In addition to improving the social security of working workers, international social security agreements help ensure continuity of benefit protection for people who have received social security credits under the U.S. system and another country.