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TN 17 (06-97)

A. INTRODUCTION

Since 1978, the United States has established a network of bilateral Social Security agreements that coordinate the U.S. Social Security program with the comparable programs of other countries. The agreements, commonly known in the United States as "Totalization" agreements, are authorized by section 233 of the Social Security Act. Subchapter GN 01701 includes an overview of the main provisions of the agreements as well as a current listing of the agreements now in effect.

The instructions in this subchapter deal specifically with the provisions of U.S. Totalization agreements that eliminate dual Social Security coverage and taxation. Dual coverage is the situation that occurs when a person from one country works in another country and is required to pay Social Security taxes to both countries on the same earnings.

Dual coverage typically affects U.S. citizens and residents when they work in another country for an American employer. Such work is covered by U.S. Social Security and is usually also covered by the foreign country's Social Security system. Foreign nationals who work in the United States face similar problems since their work is frequently covered by both the United States and their home countries. Each agreement includes rules that eliminate dual coverage by assigning a worker's coverage to only one country. The rules of each agreement are explained in the following sections of this subchapter.

B. POLICY

U.S. Social Security agreements have the force of law and modify the normal coverage provisions of title II of the Social Security Act under certain circumstances. For example, a U.S. citizen who works in France for an American employer would normally be covered by U.S. Social Security. However, if the employee's assignment in France is expected to last more than 5 years, the U.S.-French agreement would assign his or her coverage to only the French system. The worker would thus be exempt from U.S. coverage as a result of the agreement.