US citizen living and working abroad - SSA contributions?

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RVD
Posts: 112
Joined: Mon Oct 20, 2014 6:11 pm

US citizen living and working abroad - SSA contributions?

Post by RVD »

Hi,

I'm a US citizen living and working overseas. I live in Seoul, Korea and work for a Korean company (Samsung). I've been here for 2.5 years and will probably be here for at least another 2 yeas.

I'm 49 years old and am looking into early retirement in a few years so I went to ssa.gov to see my benefits and such and noticed that my income for years 2020 and 2021 were 0 and for 2019, the half that I spent here was 0.

I file and pay US income tax every year based on income made here but I guess it's logical that there is no income since the company here doesn't contribute or pay into the US social security system...The US and Korea have a treaty so I get a credit for the portion of tax paid into Korea and only pay difference to the US (e.g. if I owe $100k in taxes to the US and already paid $70k to Korea then I just pay the US $30k).

I didn't really take this into consideration when I took the job here but for others thinking of working overseas, just a heads up that this can affect future social security payments since I think they take the average income over 35 years to calculate how much social security you will get and these years over here will be 0 and if I retire early there will be more 0 years, etc.

Anwyay, thanks bogleheads for all of the great advice over the years...
Karamatsu
Posts: 1447
Joined: Mon Oct 27, 2008 2:42 am

Re: US citizen living and working abroad - SSA contributions?

Post by Karamatsu »

Yes, unless you are working for a company or government agency that is paying FICA taxes, Social Security will record zero contributions, and zero income, for the time when you're abroad. You might want to look into whether there is a totalization agreement with Korea, though. The US still won't recognize your income but you may at least get credit for having worked during that time. I'm not sure what benefits that brings, but I guess there must be something.
German Expat
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Joined: Fri Oct 16, 2009 10:49 pm

Re: US citizen living and working abroad - SSA contributions?

Post by German Expat »

The loss might not be as bad because of the bend points in social security. Will you also get a pension from Korea? If this is the case you need to read into the windfall elimination provision.

https://sgp.fas.org/crs/misc/98-35.pdf

See here also for more details and it seems like you might also get a (probably very small) payment form Korea (no idea what their rules are about minimum time to pay in etc. I am in Switzerland and unlike the US with 40 quarters minimum there is no minimum here but the WEP will get me).

https://www.ssa.gov/international/total ... tacts.html
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