U.S. Social Security & Medicare Tax

[ylwagent]

People,

I'm relocating to HK at the beginning of 2007 and have a tax question that is in need of your assistance. I am familiar with the U.S. tax benchmark and accompanying foreign stay requisite. However, I don't know whether I'll be taxed for social security and medicare. I will be under my company's local pay if that helps answer some questions. My U.S. accountant told me that I won't get taxed since I'm under local payroll but some have informed me that I will due to tax agreements. Just wondering if there are people out there working for a U.S. firm and paid locally. Welcome all inputs.

Thanks.

John

[nina_70]

This thread is a little old, but here you go. According to my understanding if you are a US citizen transferred to HK and paid locally, in HK dollars, your company can choose not to pay social security and medicare in USA. I know someone who has this arrangement right now and is not paying. Instead they are paying HK MPF (the kinda equivalent here, which is required if you're employed as a local).

If you're coming over on an expat package this is different, as you would officially be on 'temporary' assignment here and so your company still has to pay all the social security/medicare in USA. Looks like this is not the case for you. You're under 'local' terms (which is more common these days anyway).

Of couse, even as a 'local' employee, you still have to file US tax return and all that other fun stuff. And, you will still be taxed in US above the foreign earned income exclusion (so, above $82.4K in 2006, $85.7K in 2007)

[takkie]

hi.

that is weird. I am in the same boat... I am a US Citizen, and found a job as a Local HK Employee in one of the US Bank and relocated to Hong kong last year May.

My HR told me, because i am a citizen, i must pay the SSI/Medicaid, and i have been paying for the past 20 months. Are you saying that is wrong, and I dont really need to pay for it?

Or, the SSI/Medicaid, basically just goes back to my retirement account, isnt it? So, theoretically, i am not paying extra tax, I am just putting more money into my retirement acct...is taht correct?

If that is not the case, how do i get my SSI/Medicaid back?

Please share.

thx