TN 16 (11-96)
RS 02001.460 Scope of the U.S. Spanish Agreement
For the United States, the agreement applies to social security taxes under the RSDHI program; i.e., FICA for employees and employers and SECA for self-employed persons, including the Medicare portion. It does not affect taxes related to any other programs such as Workers' Compensation or Unemployment Insurance. Thus, if an individual is exempt from U.S. Social Security coverage under this agreement, neither the employee nor employer share of the FICA tax, or SECA tax in the case of a self-employed person, is required to be paid.
For Spain, the agreement applies to taxes which finance all benefit programs under the general and special social security programs. This includes not only the taxes which finance old-age, survivors, and disability benefits, but also the taxes which finance other Spanish programs such as temporary disability (short-term cash sickness) benefits, unemployment benefits, family allowances, national health insurance, and various other benefits. Consequently, if a worker is exempt from Spanish social security coverage as a result of the agreement, no contributions are due under any of the Spanish social security benefit programs.