The Wall Street Journal invited Creveling & Creveling to be part of a panel of experts for personal finance on its WSJ Expat site. The following article originally appeared on the WSJ site and has been shared with permission.
We asked Peggy and Chad Creveling of Asia-based Creveling & Creveling Private Wealth Advisory to help U.S. expats with non-resident alien spouses navigate the U.S. Social Security system. Send your expat finance questions to firstname.lastname@example.org. Keep an eye on WSJ Expat to see if your questions-and answers provided by our experts-are published.
Navigating the rules of U.S. Social Security benefits is complicated for any U.S. citizen, but it's even more complex for U.S. citizens living abroad with Non-Resident Alien (not living in the U.S. and not a U.S. citizen) spouses. We are often asked two questions in these cases. First, as an American living overseas can I still receive Social Security benefits? Second, does my NRA spouse qualify to receive either Social Security spousal benefits (one-half of your benefit paid while you are alive) or survivor benefits (your full benefit paid after you die) based on my work history?
The answer to the first question is pretty straight forward. If you are a U.S. citizen or green card holder living outside the U.S., you can receive your Social Security payment as long as:
- You're eligible for Social Security payments, having earned the required 40 credits by contributing to U.S. Social Security for at least 10 years.
- You're at least 62 years old.
- You're not living in certain countries, such as Cuba or North Korea. Generally, payments also cannot be sent to individuals residing in Azerbaijan, Belarus, Georgia, Kazakhstan, Kyrgyzstan, Moldova, Tajikistan, Turkmenistan, Ukraine, Uzbekistan or Vietnam. (This list changes from time to time, so check with the Social Security Administration for updates.)
Your benefits can be mailed to your foreign address or deposited electronically in a financial institution located in your country of residence or in the U.S. (subject to the restrictions above).
Whether your NRA spouse qualifies for either spousal or survivor benefits is considerably more complex and governed by a mishmash of historic Social Security treaties (or lack of) between the U.S. and various countries. For the purpose of this discussion, we are talking about NRA spouses who do not qualify for Social Security in their own right and have not lived in the U.S. with their U.S. citizen spouses. Additionally, as with U.S. spouses, to receive benefits the NRA spouse must be of full retirement age (or age 62 for reduced benefits) and the U.S. citizen spouse must be receiving benefits.
In general, there are two broad themes that run through the treaties: citizenship and residency.
Citizenship Rule: If an NRA spouse is a citizen of one of the following countries they are eligible for spousal and survivor benefits regardless of their country of residence (subject to restrictions on payment covered above): Australia, Austria, Belgium, Canada, Chile, Czech Republic, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Japan, South Korea, Luxembourg, Netherlands, Norway, Poland, Portugal, Spain, Sweden, Switzerland, and the U.K.
Residency Rule: Similarly, if an NRA spouse is a resident (not necessarily a citizen) of one of the following countries with which the U.S. currently has a bilateral Social Security agreement, he or she is eligible for spousal and survivor benefits: Australia, Austria, Belgium, Canada, Chile, Czech Republic, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Japan, South Korea, Luxembourg, Netherlands, Norway, Poland, Portugal, Spain, Sweden, Switzerland, and the U.K.
Note, the countries listed above change from time-to-time. Contact the Social Security Administration's international office for updated information.
Finally, there is a "Five-year U.S. residency Rule" that may apply in some situations.
Five-Year U.S. Resident Rule: If your foreign spouse is neither a citizen nor resident of the countries listed above, he or she may still may be able to collect ongoing spousal Social Security benefits if the two of you lived together in the U.S. (not necessarily continuously) for at least five years while married. This can be useful for Americans who may retire in Asia or Latin America, as with the exceptions of Japan and South Korea. Most countries in these regions are not on the citizenship or residency lists.
Additionally, if it's important to your situation that your spouse receives Social Security spousal benefits, you could move back to the US, meet the Five-Year rule and then move abroad if desired. If you die, your widowed spouse could still complete the residency requirement and then qualify for survivor benefits.
The information above is intended as general guidance only. The rules and exceptions pertaining to Social Security benefits for those living abroad can be exceeding complex, particularly given the large number of situational permutations that can occur with U.S. citizens and NRA spouses living overseas. Contact the Social Security Administration for specific guidance on your unique situation. Here are some other links that may help:
About Creveling & Creveling Private Wealth Advisory
Creveling & Creveling is a private wealth advisory firm specializing in helping expatriates living in Thailand and throughout Southeast Asia build and preserve their wealth. The firm is a Registered Investment Adviser with the U.S. SEC and is licensed and regulated by the Thai SEC. Through a unique, integrated consulting approach, Creveling & Creveling is dedicated to helping clients cut through the financial intricacies of expat life, make better decisions with their money, and take the steps necessary to provide a more secure future. For more information, visit www.crevelingandcreveling.com.