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Totalization Agreement with Japan |
(Based on SSA Publication #05-10165, ICN 469150)
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OMB Approval Number: 0960-0554 |
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Table of Contents |
Part I -- Introduction
Part II -- Coverage and Social Security taxes
Part III -- Certificate of coverage
Part IV -- Monthly benefits
Part V -- A Japanese pension may affect your U.S. benefitPart VI -- What you need to know about MedicarePart VII -- Claims for benefits
Part VIII -- For more information |
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Part I -- Introduction |
An agreement effective October 1, 2005, between the United States and Japan improves Social Security protection for people who work or have worked in both countries. It helps many people who, without the agreement, would not be eligible for monthly retirement, disability or survivors benefits under the Social Security system of one or both countries. It also helps people who would otherwise have to pay Social Security taxes to both countries on the same earnings. For the United States, the agreement covers Social Security taxes (including the U.S. Medicare portion) and Social Security retirement, disability and survivors insurance benefits. It does not cover benefits under the U.S. Medicare program or the Supplemental Security Income program. For Japan, the agreement covers Social Security taxes (including the Japanese health insurance portion, in some cases) and Social Security retirement, disability and survivors benefits. It doesn’t cover the National Pension Fund and the Employees’ Pension Fund which are corporate pension funds under which participation and contributions are voluntary. The pension system for members of local assemblies, a supplemental pension system for local government workers, is also not covered by the agreement. The agreement also doesn’t apply to the Old-Age Welfare Pension or other Japanese non-contributory, means-tested allowances paid from general revenues. This document covers highlights of the agreement and explains how it may help you while you work and when you apply for benefits.
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The agreement may help you, your family and your employer |
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Part II -- Coverage and Social Security taxes |
Before the agreement, employees, employers and self-employed people could, under certain circumstances, be required to pay Social Security taxes to both the United States and Japan for the same work. Under the agreement, if you work as an employee in the United States, you normally will be covered by the United States, and you and your employer will pay Social Security taxes only to the United States. If you work as an employee in Japan, you normally will be covered by Japan, and you and your employer pay Social Security taxes only to Japan. On the other hand, if your employer sends you from one country to work for that employer in the other country for five years or less, you will continue to be covered by your home country and you will be exempt from coverage in the other country. For example, if a U.S. company sends an employee to work for that company in Japan for no more than five years, the employer and the employee will continue to pay only U.S. Social Security taxes and will not have to pay in Japan. Special rules apply to self-employed persons who, without the agreement, would have to pay Social Security taxes to both countries (see the table in Part II).
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Summary of agreement rules |
The following table shows whether your work is covered under the U.S. or Japanese Social Security system. If you are covered under U.S. Social Security, you and your employer (if you are an employee) must pay U.S. Social Security taxes. If you are covered under the Japanese system, you and your employer (if you are an employee) must pay Japanese Social Security taxes. Part III explains how to get a form from the country where you are covered that will prove you are exempt in the other country.
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NOTE: As the table indicates, a U.S. worker employed in Japan can be covered by U.S. Social Security only if he or she works for a U.S. employer. A U.S. employer includes a corporation organized under the laws of the United States or any state, a partnership if at least two-thirds of the partners are U.S. residents, an individual who is a resident of the U.S. or a trust if all the trustees are U.S. residents. The term also includes a foreign affiliate of a U.S. employer if the U.S. employer has entered into an agreement with the Internal Revenue Service under section 3121(l) of the Internal Revenue Code to pay Social Security taxes for U.S. citizens and residents employed by the affiliate.
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Part III -- Certificate of coverage |
A certificate of coverage issued by one country serves as proof of exemption from Social Security taxes on the same earnings in the other country. |
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III.A. Certificates for employees |
To establish an exemption from compulsory coverage and taxes under the Japanese system, your employer must request a certificate of coverage (form USA/J 6) from the United States at this address: Social Security Administration If preferred, the request may be sent by fax to (410) 966-1861. Please note this fax number should only be used for requesting certificates of coverage. No special form is required to request a certificate, but, the request must be in writing and provide the following information:
In addition, your employer must indicate whether you remain an employee of the U.S. company while working in Japan or you become an employee of the U.S. company’s affiliate in Japan. If you become an employee of an affiliate, your employer must indicate whether the U.S. company has an agreement with the Internal Revenue Service under section 3121(l) of the Internal Revenue Code to pay U.S. Social Security taxes for U.S. citizens and residents employed by the affiliate and, if yes, the effective date of the agreement. Your employer can also request a certificate of U.S. coverage for you over the Internet using a special online request form available at www.socialsecurity.gov/coc. Only an employer can use the online form to request a certificate of coverage. A self-employed person must submit a request by mail or fax. NOTE: In addition to retirement, disability and survivors benefits, Japanese Social Security taxes cover several other benefit programs including Japan’s health insurance program. If the employer or a self-employed person certifies the worker and all family members who accompany the worker to Japan are covered by an employer-sponsored or other private health insurance plan while in Japan, the worker and accompanying family members can be exempted from paying Japanese Social Security taxes including contributions to Japan’s health insurance program and cannot receive health care services or other benefits under the Japanese health insurance system. If the employer or self-employed person does not certify that the worker and all family members who accompany the worker to Japan are covered by an employer sponsored or other private health insurance plan while in Japan, the worker and accompanying family members must pay Japanese Social Security taxes including contributions for Japan’s health insurance system. To establish your exemption from coverage under the U.S. Social Security system, your employer in Japan must request a certificate of coverage (form J/USA 6) from the local Japanese social insurance agency that collects your Social Security taxes in Japan. The same information required for a certificate of coverage from the
United States is needed to get a certificate from Japan except that:
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III.B. Certificates for self-employed people |
If you are self-employed and would normally have to pay Social Security taxes to both the U.S. and Japanese systems, you can establish your exemption from one of the taxes.
Be sure to provide the following information in your letter:
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III.C. Effective date of coverage exemption |
The certificate of coverage you receive from one country will show the effective date of your exemption from paying Social Security taxes in the other country. Generally, this will be the date you began working in the other country, but no earlier than the effective date of the agreement. Certificates of coverage issued by Japan should be retained by the employer in the United States in case of an audit by the Internal Revenue Service (IRS). No copies should be sent to IRS unless specifically requested by IRS. However, a self-employed person must attach a photocopy of the certificate to his or her income tax return each year as proof of the U.S. exemption. Note: Japanese certificates of coverage will be issued using Japanese characters not Roman characters. It will be up to the employer in the United States or the self-employed person to have the Japanese certificate translated. Copies of certificates of coverage issued by the United States will be provided for both the employee and the employer. It will be their responsibility to present the certificate to the Japanese authorities when requested to do so. To avoid any difficulties, your employer (or you, if you are self-employed) should request a certificate as early as possible, preferably before your work in the other country begins. If you or your employer request a certificate of coverage, you should read the Privacy Act and Paperwork Reduction Act statements below.
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Part IV -- Monthly benefits |
The following table shows the various types of Social Security benefits payable under the U.S. and Japanese Social Security systems and briefly describes the eligibility requirements that normally apply for each type of benefit. If you do not meet the normal requirements for these benefits, the agreement may help you to qualify (see Part IV.A below). It is important to know that Japan pays benefits through a two-tiered program. The first tier, called the National Pension (NP), is a contributory, universal program that covers all residents of Japan. The second tier is made up of four supplementary earnings-related programs, the most important of which is called the Employees' Pension Insurance (EPI). The EPI covers employed people in commerce and industry, including miners and merchant seamen. The three other earnings-related programs cover distinct occupational groups. The term EPI is sometimes used to refer to all four second-tier programs. This table is only a general guide. You can get more specific information about U.S. benefits elsewhere on our web site or at any U.S. Social Security office or by calling our toll-free number at 1-800-772-1213. You can get more detailed information about Japanese benefits by writing to the Japanese system to which you pay Japanese Social Security taxes or by visiting the Japanese Social Security system's website at www.ipss.go.jp/index-e.html. Under U.S. Social Security, you may earn up to four credits each year depending on the amount of your covered earnings. The amount needed to earn a work credit goes up slightly each year. For more information, see How You Earn Credits (SSA Publication No. 05-10072). Under the Japanese system, credits are measured in months. To simplify the information in the table, requirements are shown in years of credits.
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Monthly benefits and eligibility requirements |
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IV.A. How benefits can be paid |
If you have Social Security credits in both
the United States and Japan, you may be eligible for benefits from one
or both countries. If you meet all the basic requirements under one country’s
system, you will get a regular benefit from that country. If you do not
meet the basic requirements, the agreement may help you qualify for a
benefit as explained below. |
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IV.A.1. Benefits from the United States |
If you do not have enough work credits under
the U.S. system to qualify for regular benefits, you may be able to qualify
for a partial benefit from the United States based on both U.S. and Japanese
credits. However, to be eligible to have your Japanese credits counted,
you must have earned at least six credits (generally one and one-half
years of work) under the U.S. system. If you already have enough
credits under the U.S. system to qualify for a benefit, the United States
cannot count your Japanese credits. |
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IV.A.2. Benefits from Japan |
Social Security credits from both countries
can also be counted, when necessary, to meet the eligibility requirements
for Japanese benefits. To be eligible to have your U.S. and Japanese credits
counted, you must have at least one month of coverage credited under the
Japanese system. |
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IV.B. How credits get counted |
You do not have to do anything to have your credits in one country counted by the other country. If we need to count your credits under the Japanese system to help you qualify for a U.S. benefit, we will get a copy of your Japanese record directly from Japan when you apply for benefits. If Japan needs to count your U.S. credits to help you qualify for a Japanese benefit, Japan will get a copy of your U.S. record directly from the Social Security Administration when you apply for the Japanese benefit. Although each country may count your credits in the other country, your credits are not actually transferred from one country to the other. They remain on your record in the country where you earned them and can also be used to qualify for benefits there.
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IV.C. Computation of U.S. benefit under the agreement |
When a U.S. benefit becomes payable as a result of counting both U.S. and Japanese Social Security credits, an initial benefit is determined based on your U.S. earnings as if your entire career had been completed under the U.S. system. This initial benefit is then reduced to reflect the fact that Japanese credits helped to make the benefit payable. The amount of the reduction will depend on the number of U.S. credits: the more U.S. credits, the smaller the reduction; and the fewer U.S. credits, the larger the reduction.
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Part V -- A Japanese pension may affect your U.S. benefit |
If you qualify for Social Security benefits from both the United States and Japan and you did not need the agreement to qualify for either benefit, the amount of your U.S. benefit may be reduced. This is a result of a provision in U.S. law that can affect the way your benefit is figured if you also receive a pension based on work that was not covered by U.S. Social Security. For more information, call our toll-free number, 1-800-772-1213, and get the publication, Windfall Elimination Provision (Publication #05-10045). If you are outside the United States, you may write to us at the address in Part VIII.
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Part VI -- What you need to know about Medicare |
Medicare is the U.S. national health insurance system for people age 65 or older or who are disabled. Medicare has two parts: hospital insurance (also called "Part A" Medicare) and medical insurance (called "Part B" Medicare). You are eligible for free hospital insurance at age 65 if you have worked long enough under U.S. Social Security to qualify for a retirement benefit. People born in 1929 or later need 40 credits (about 10 years of covered work) to qualify for retirement benefits. Although the agreement between the United States and Japan allows the Social Security Administration to count your Japanese credits to help you qualify for U.S. retirement, disability or survivor benefits, the agreement does not cover Medicare benefits. As a result, we cannot count your credits in Japan to establish entitlement to free Medicare hospital insurance. For more information about Medicare, call our toll-free number, 1-800-772-1213, and ask for the publication, Medicare (Publication #05-10043) or visit Medicare’s website at www.medicare.gov.
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Part VII --Claims for benefits |
If you live in the United States and wish to apply for U.S. or Japanese benefits:
You can apply for Japanese benefits at any U.S. Social Security office by completing an application form J/USA 1 to apply for retirement or disability benefits or application form J/USA 2 to apply for survivors' benefits. If you live in Japan and wish to apply for U.S. or Japanese benefits, contact:
You can apply with one country and ask to have your application
considered as a claim for benefits from the other country. Information
from your application will then be sent to the other country. Each country
will process the claim under its own laws—counting credits from
the other country when appropriate—and notify you of its decision.
If you have not applied for benefits before, you may need to provide certain information and documents when you apply. These include the worker’s U.S. Social Security number, the worker's Japanese Basic Pension number, proof of age for all claimants, evidence of the worker’s U.S. earnings in the past 24 months and information about the worker’s coverage under the Japanese system. You may wish to call the Social Security office before you go there to see if any other information is needed.
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VII.A. Payment of benefits |
Each country pays its own benefit. U.S. payments
are made by the U.S. Department of Treasury each month and cover
benefits for the preceding month. Japanese benefits are paid by direct
deposit on the 15th of even-numbered months in Japan and cover benefits
for the preceding month and the current month. For overseas payments,
the benefit is paid by direct deposit approximately three to seven days
after the 15th of the month and also covers benefits for the preceding
month and the current month. |
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VII.B Absence from U.S. territory |
Normally, persons who are not U.S. citizens may receive U.S. Social Security benefits while outside the United States only if they meet certain requirements. Under the agreement, however, if you are a U.S. or Japanese citizen, a refugee, a stateless person, or a person who is eligible for dependents or survivors benefits based on the Social Security record of one of these people, you may receive benefits as long as you reside in Japan. If you are not a U.S. or Japanese citizen and live in another country, you may not be able to receive benefits. The restrictions on U.S. benefits are explained in "Your Payments While You Are Outside The United States" (Publication #05-10137).
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VII.C Appeals |
If you disagree with the decision made on your claim for benefits under the agreement, contact any U.S. or Japanese Social Security office. The people there can tell you what you need to do to appeal the decision. The Japanese Social Security authorities will review your appeal if it
affects your rights under the Japanese system, while U.S. Social Security
authorities will review your appeal if it affects your rights under the
U.S. system. Since each country’s decisions are made independently
of the other, a decision by one country on a particular issue may not
always conform with the decision made by the other country on the same
issue. |
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Part VIII -- For more information |
To file a claim for U.S. or Japanese benefits under the agreement, follow the instructions in Part VII. To find out more about U.S. Social Security benefits or for information about a claim for benefits, contact any U.S. Social Security office or call our toll-free number at 1-800-772-1213. If you live outside the United States, write to:
For more information about Japan’s Social Security program, contact any branch office of a Japanese social insurance agency or:
If you do not wish to file a claim for benefits, but would like more information about the agreement, write to:
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Last reviewed or modified Wednesday Sep 10, 2008 |