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. „The United States believes that due to the incompatibility of the two social security systems, the totalization agreement may not be plausible in the current context,“ says the joint CII-USIBC report, which recommends an analysis of the feasibility and prospects of an agreement. According to an industry estimate, Indians working in the United States lose nearly $1 billion a year in social security contributions. 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. Anyone seeking more information about the U.S. Social Security totalization program – including details of some existing agreements – should write that the self-employed rule may apply if the U.S. employer transfers an employee to an overseas branch or to one of its foreign subsidiaries. However, in order for U.S.
coverage to continue when a transferred employee works for a foreign subsidiary, the U.S. employer must have entered into a Section 3121 (l) agreement with the U.S. Treasury Department with respect to the foreign subsidiary. 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. Double tax debt may also affect U.S. citizens and residents working for foreign subsidiaries of U.S. companies. This is likely to be the case when a U.S. company has followed the common practice of entering into an agreement with the Treasury, pursuant to Section 3121 (l) of the Internal Income Code, to provide social security to U.S. citizens and residents employed by the subsidiary.
In addition, U.S. citizens and residents who are independent outside the United States are often subject to double social security taxation, as they are covered by the U.S. program, even if they do not have a U.S. business. Under certain conditions, a worker may be exempt from coverage in a contracting country, even if he or she has not been transferred directly from the United States.
