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Norally, you do pay SS. You file a 1040NR and then file in the foreign country too. You take a tax credit for foreign taxes paid, so you do not pay twice. This way, your social security will get credited, but you do not have to pay full tax in two coutries.
As a "U.S. Person", you are required to file a 1040, in this case, a 1040NR. You are taxed (including SS) on your worldwide income. Then the U.S. will let you take a credit for the foreign taxes paid. A good tax preparer can help you with this, or you can try to bang it out yourself. Make sure to file the form for a Foreign Tax Credit.
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I understand all this but my question is as an American working for a Foreign Company (not self employed) in a foreign country....
I see. /the foreign company will not withhold and pay social security.
Whether the foreign company is required to pay depends on whether there is a Totalization Agreement in place with that country.
That means your ss benefits will be lower or you will have no benefits in usa for ss. However, you may qualify for benefits in that country, even if you move back to the USA.
Under a Totalization Agreement, dual coverage and dual contributions (taxes) for the same work are eliminated. The agreements generally make sure that you pay social security taxes to only one country.
Covered by U.S. only. If your pay in a foreign country is subject only to U.S. social security tax and is exempt from foreign social security tax, your employer should get a certificate of compliance from the Office of International Programs of the Social Security Administration.
Covered by foreign country only. If you are permanently working in a foreign country with which the United States has a social security agreement and, under the agreement, your pay is exempt from U.S. social security tax, you or your employer should get a statement from the authorized official or agency of the foreign country verifying that your pay is subject to social security coverage in that country.
If the authorities of the foreign country will not issue such a statement, either you or your employer should get a statement from the U.S. Social Security Administration, Office of International Programs, at the address below. The statement should indicate that your wages are not covered by the U.S. social security system.
This statement should be kept by your employer because it establishes that your pay is exempt from U.S. social security tax.
Only wages paid on or after the effective date of the totalization agreement can be exempt from U.S. social security tax.
Generally, under these agreements, you will only be subject to social security taxes in the country where you are working. However, if you are temporarily sent to work in a foreign country, and your pay would otherwise be subject to social security taxes in both the United States and that country, you generally can remain covered only by U.S. social security. You can get more information on any specific agreement by contacting the United States Social Security Administration. You can get more information from the Social Security International Program Web site.
To establish that your pay in a foreign country is subject only to U.S. social security tax and is exempt from foreign social security tax, your employer in the United States should write to the:
U.S. Social Security AdministrationOffice of International ProgramsP.O. Box 17775Baltimore, MDNNN-NN-NNNN/p>
Your employer should include the following information in the letter:
Telephone inquiries should be directed to the numbers shown on the following page: International Operations-Contact Us by Phone.
Your employer can request a Certificate of Coverage for his employees who work outside of the United States online by going to online certificate of coverage service.
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