American citizens who retire abroad are eligible for social security benefits.
Of course, everything about social security is subject to change in the coming years. But it is good to know that overseas retirees are not shortchanged on this (as is the case for Medicare, which I will cover in a separate post).
Here are the important facts about receiving social security payments while living outside the US:- If you are a US citizen, you are eligible for social security retirement benefits (provided you have worked for a minimum of 10 years), just as if you stayed in the US.
- If you are not a US citizen, your eligibility to receive social security benefits depends on which country you are a citizen of. [If you are an Indian citizen, you are eligible to receive benefits provided you have lived in the US for at least 10 years or earned at least 40 credits under the social security system.]
- Social Security payments may be deposited directly into your account at a US financial institution. This is the most convenient way to receive social security payments. They may also be directly deposited into accounts in some other countries. However, India is not one of them.
- The Social Security benefits paid to a US citizen outside the US are taxed in the same manner as those paid to a US citizen living in the US. In addition, some foreign governments also tax US Social Security benefits. [Under the Indo-US Double Taxation Avoidance Agreement (DTAA), India does not tax social security payments.]
Related posts:
Related links:- AARP's FAQ about receiving social security benefits abroad
- SSA publication on social security payments outside the US
- India: Double taxation Avoidance agreements with other countries
34 comments:
Will a Green Card holder who earned more than 40 Social Security credits, returns to India (thus forsaking US citizenship), be eligible to get Social Security payouts at the retirement age? If he maintains a US bank account, can the payout be direct deposited?
jack,
Under current rules, the answer to both questions is "Yes". Rules may change in the coming years, so I would not depend on this too much.
My understanding was that social security is paid overseas only to citizens or permanent residents. Now, if a green card holder is living in India, then he automatically loses his permanent residency status, and thus will not be eligible for social security payments.
You answered "yes" to jack's question. Am I missing something?
You do not have to be a citizen or permanent resident to receive social security benefits under current rules. The SSA publication that I linked to (under Related links) has all the details on social security eligibility for non-citizens.
This is not the case for all countries -- India is one of the countries listed as an exception to the normal case (which is that SS payments stop after 6 months of leaving the US).
Hi Nigel,
On reading the publication in detail, my understanding is that, for a person who has stayed in the US for 10 years and has now moved back to India, the Social Security benefits paid will almost be negligible because the benefits are paid only based on the average salary paid in the US for the last 35 years before retirement. In this case, I would not have got any US salary for the last 20-25 years since I've been working in the US.
Someone who paid social security payroll taxes only for 10 years (whether they continued to live in the US or left the country) will be eligible for much lower benefits than someone who did for 30+ years. After all, that would only be fair!
I have an earlier post on social security retirement benefits where I discussed details of how social security payments are calculated.
I am an Indian by descent and a naturalized US citizen. I plan on retiring as an OCI in India after another 4 years,at the age of 62. I do have enough credits for social security benefits, just adequate to sustain me there while I will find some approprite area to volunteer for the longest that I will be able to.
My question is about taxes. Will my social security income be taxed both by US and India?
Anon,
As I mention in the article, India does not tax Social security payments (due to tax treaty between India and the US).
Your Social security payments are considered taxable income in the US. Whether you have to pay any actual US taxes depends on several other factors -- How much will you receive in SS payments? Will you have any other income? What tax credits/deductions will you be eligible for? You will need to figure this based on your specific situation.
Hi,
For final benefit amount, does it matter if one is US citizen or Not?
for example : What will be the difference in $ amount when an Indian citizen (have at least 40 credits in USA to qualify for social security benefits) vs. US Citizen ( both residing in India ) and all other factors being equal.
Thanks for you post.
Anon,
Under current rules, your SS benefit amount does not depend on your citizenship status.
I am a Canadian citizen, contributed 40+ credits for SS benefits and plan to live in India next month onwards to care for my parents. Now, am i eligible to get SS benefits? No GC yet as the US Govt is delaying the job, but GC process is over and currently on EAD.
Geeth,
You are in the same situation as any Canada-born Canadian citizen who has earned 40+ SS credits. So of course you would be eligible for SS benefits. Your U.S. visa status has nothing to do with this.
Hi Nigel,
I am not a Canada born Canadian citizen. I am an India born , naturalized canadian citizen. Will I be still eligible for SS benefits if I live in India after retirement. Since your reply specifically indicates that canada born canadian citizens are eligible, I need clarification on the above point.
Geeth,
What I was trying to say was that there is no difference between naturalized and native-born citizens as far as eligibility for SS benefits is concerned.
Do not take my word on this: please read the SSA publication I linked to in the article. Under current law, eligibility for SS benefits is quite simple -- it just depends on how long you have contributed into SS, and which country you are currently a citizen of.
Hi,
Nigel, you said that an Indian citizen who gives up her GC and returns to India will get SS benefits if they have 40 credits.
How will she pay US taxes though when she is not a US citizen? I mean, how does one file US taxes without a citizenship status?
I am in this situation. I've returned to India without a US passport and am not planning to get it either.
Thanks
Rao
Rao,
You do not need to be a US citizen to file taxes. (After all, plenty of non-citizens work in the US and pay taxes). If you ever contributed to Social security, you must have a social security number. That's all you need to file taxes. And even if you don't, you can request a Tax ID (TIN) from the IRS.
OK, thanks, Nigel. That is true. I used to file taxes as a non-immigrant too. I do have an SSN and have 40 credits. Hence the concern about getting my money back.
Is there no way of getting a refund of the money we have been putting into SS if we agree to forfeit the benefits at retirement?
Thanks
Rao
Any inputs to my question regarding SS refund for GC holders who want to leave the country?
Thanks. Any help is appreciated.
Rao
Rao,
There is no way to get a "refund" of the social security contributions made by an employee (except in some special visa situations for people who are not eligible for SS benefits). Social security contributions made by workers are used immediately to pay benefits to current retirees. It is no more possible to get them back than it is to get back federal taxes paid.
Here is my situation, I worked for 8 years including border months in these years where I earned 44 points (example 1995-1996 visit will fetch 8 points). Hope someone also has similar situation. I did not have Green Card. Now I am permanently located in India. Wish to check if some one has done enough research to figure out If I am eligible for Social security benifits. Your feedback is much appreciated.
So far as I can understand, being an Indian citizen living in India, I can get SSA benefits provided I have 40 credits at least. I am 40 years old and plan to work in India till retirement. Since it will be 27 years before full retirement age for SSA benefits and I'll contribute nothing for the next 27 years, will I be penalised for working and not contributing and thus either will receive low payments or delayed benefits. Thanks.
Anon,
As one would expect, your social security check depends on how long (and how much) you contributed into the system. Why not try one of the calculators at the Social security site (http://www.socialsecurity.gov/OACT/anypia/index.html) to estimate for yourself what your expected payments would be? Also keep in mind that things may change in the future, so this is not a sure thing.
HI NIgel,
This blog is excellent. Thanks a lot for your valuable comments about ss benefits. After seeing this I applied for my ss benefits and I am getting them. I am not a us citizen and I dont have the green card now.
I have the necessary 40 credits.
They are withholding 30% of the 85% benefits. Is this correct?
thanks
vv
Rao,
How are you getting your benifits since you do not have an account at a US financial institution? Do you have to go to the US consulate every month to collect? And are you getting 85% benifits because you are not yet 67? I presume that the 30 % witholding is due to to the 30% tax you have to pay as a non resident alien. Please reply.
Rao,
How did you obtain social security benefits? By visiting the us consualte? Do you need to collect the check every month?
Raghavan
Hi Rao,
Can you please document the procedure here, so that it will be useful to others like you.....
Thanks.
I am 61 years old and about 10 years in USA with green card. I am eligible for getting US citizenship by naturalization. We have plan to retire to India may be 8 years from now. Our children will stay back in USA. In India we will have to depend on the SS benefit for our living. we can not decide my mind whether we should take US citizenship or continue with Green Card. Can you please give your frank suggestion what should be done in such situation ?
Swapan,
This is really a personal decision and you could go either way. I think US Citizenship with OCI status will give you the most flexibility -- you can live in either country for any length of time and travel back and forth without any restrictions.
Nigel,
You are absolutely correct. This is really a personal choice. I was just thinking from the procedural aspect like getting SS benefit, movement between USA and India, residence requirement etc. I think your suggestion of retiring to India with US citizenship and OCI card is very wise. I have a friend who has Green Card but mainly lives in India. He visits USA may be once a year to his children. He has to answer lots of question on his long absence from USA every time he enters USA. Every time he is told that being a permanent resident (Green card)he can not stay outside USA for a long time repeatedly. I think US citizens do not have such restriction. Am I correct ? Finally lots of thanks for your website. It really helps.
I am US Citizen. Will my parents be eligible for social security retirement benefit if I sponsored them for permanent residency ? They have never worked in US.
Anon,
No, they won't qualify. You may be thinking of SSI (Supplimental Security income) which is a federal assistance program different from Social security. Since you will be supporting your parents, they will not need, nor qualify for, federal assistance.
It is very useful post and helped decide me if I need to take US citizenship before leaving for India. I already have 40 credits. SS office told me that I can get the payment in India but they will deduct 15% as alien tax. Now what is this addition 30% deduction from 85% payment? If it is US I Tax deduction at source, will I get a refund after filing tex return?
my father is an Indian citizen who lives in Malaysia with us because he cannot take care of himself anymore. He gets annuity checks dont know whether he has 40 points or not. He is too old to endorse his checks. his signature is shaky.
His bank in India (a US bank) is not accepting unendorsed checks unless he deposits them in person which he cant do because he is not in India. They will not accept a thumb impression either. Now he doesnt have a social security number anymore
Is he even eligible for these checks? It wd be a shame if he werent...The US embassy has never said he isnt eligible
what can I do to get them to accept unendorsed checks.
I am 61 years of age and a US citizen . Have been working in US since 1197and also presently employed. Have 40 credits.
If I move to India now, am I eligible for social security benefits and the procedure.
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