When concluding a totalization agreement, the United States and a partner country agree to coordinate the rules on social security and payment of benefits for persons who have worked in both countries during their working lives. Totalization agreements have three main objectives. First, they remove the double taxation of social security that occurs when a worker and his employer are required to pay social security taxes to two countries with equal income. Second, they help fill gaps in the coverage records of people who have divided their careers between two countries by combining or adding up the coverage periods earned in each country. Finally, the aggregation agreements make it possible to pay full benefits to the inhabitants of both countries. Although these three objectives do not represent the set of totalisation agreements, they are by far the most visible and have the most impact on businesses and workers. All aggregation agreements have certain characteristics in common, but the complexity and differences in the social security legislation of our partner countries make each agreement unique. Since the 1970s, U.S. negotiators have entered into bilateral agreements with 28 major trading partners to coordinate social security and benefit plans for people who live and work in more than one country during their working lives. They are known as «totalization» agreements and resemble operating and structural contracts and are legally classified as agreements between Congress and the executive branch in accordance with the law. The agreements have three main objectives: to enable the elimination of double taxation of income, the protection of benefits for workers who have shared their careers between the United States and another country, and the full payment of benefits to residents of both countries. This article briefly describes the totalization agreements, tells their story, and examines the proposals for modernization and improvement.
The goal of all U.S. totalization agreements is to eliminate dual social security and tax coverage while maintaining coverage for as many workers as possible under the regime of the country where they probably have the greatest attachment, both at work and after retirement. . . .