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Wednesday, February 17, 2010

Social Security Benefits for Noncitizens

Dawn Nuschler
Specialist in Income Security

Alison Siskin
Specialist in Immigration Policy

Concerns about the number of unauthorized (illegal) aliens residing in the United States and the totalization agreement with Mexico have fostered considerable interest in the eligibility of noncitizens for U.S. Social Security benefits. The Social Security program provides monthly cash benefits to qualified retired and disabled workers, their dependents, and survivors. Generally, a worker must have 10 years of Social Security-covered employment to be eligible for retirement benefits (less time is required for disability and survivor benefits). Most U.S. jobs are covered under Social Security, and as a result, noncitizens who are authorized to work in the United States are eligible for a Social Security number (SSN). Noncitizens who work in Social Securitycovered employment must pay Social Security payroll taxes, including those who are in the United States working temporarily or without authorization. There are some exceptions. Generally, the work of aliens who are citizens of a country with which the United States has a "totalization agreement," coordinating the payment of Social Security taxes and benefits for workers who divide their careers between two countries, is not covered if they work in the United States for less than five years. Also, by statute, the work of aliens under certain visa categories is not covered by Social Security. 

The Social Security Protection Act of 2004 (P.L. 108-203) requires an alien whose application for benefits is based on an SSN assigned January 1, 2004, or later to have work authorization at the time an SSN is assigned, or at some later time, to gain insured status under the Social Security program. Aliens whose applications are based on SSNs assigned before January 1, 2004, may count all covered earnings toward insured status, regardless of work authorization. The Social Security Act also prohibits the payment of benefits to aliens in the United States who are not "lawfully present"; however, under certain circumstances, alien workers as well as their dependents and survivors may receive benefits while residing outside the United States (including benefits based on unauthorized work). 

In June 2004, the United States and Mexico signed a totalization agreement. In early 2007, a copy of the agreement was made publicly available. The agreement has not been transmitted to Congress for review and has not been finalized. Currently, because Mexico meets the "social insurance country" definition, a Mexican worker may receive U.S. Social Security benefits outside the United States. Family members of the Mexican worker must have lived in the United States for at least five years to receive benefits in Mexico. The agreement does not waive the requirements that aliens in the United States must be lawfully present to receive benefits in the United States, and that aliens must have work authorization at some time to gain insured status, but would allow payment of benefits to alien dependents and survivors who have never lived in the United States. The Social Security Administration reports that the projected cost of the agreement would average $105 million annually over the first five years. The Government Accountability Office reports that "the cost of [the] totalization agreement ... is highly uncertain" due to the large number of unauthorized aliens from Mexico estimated to be living in the United States. 

This report will be updated as legislative activity occurs or other events warrant.

Date of Report: February 2, 2010
Number of Pages: 29
Order Number: RL32004
Price: $29.95

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