Social Security tax consequences of working abroad

When Social Security and Medicare taxes apply outside of the United States

In general, U.S. social security and Medicare taxes continue to apply to wages for services you perform as an employee outside of the United States if one of the following applies:

• You are working for an American employer which includes:
  • The U.S. Government or any of its instrumentalities
  • An individual who is a resident of the United States
  • A partnership of which at least two-thirds of the partners are U.S. residents
  • A trust of which all the trustees are U.S. residents
  • A corporation organized under the laws of the United States, any U.S. state, or the District of Columbia, Puerto Rico, the Virgin Islands, Guam, American Samoa, or the Commonwealth of the Northern Mariana Islands (with respect to the CNMI, refer to Revenue Ruling 80-167).
  • You entered into your employment contract within the United States, or
  • The vessel or aircraft touches at a U.S. port while you are employed on it.

  Excludable meals and lodging

  Social security tax does not apply to the value of meals and lodging excluded from your income because it was provided for the convenience of your employer.

  Totalization Agreements

  Under a Totalization Agreement, dual coverage and dual contributions (taxes) for the same work are eliminated. The agreements generally ensure that you pay social security taxes to only one country.