For the United States, the Agreement applies only to the Retirement, Survivors, Disability, and Health Insurance (RSDHI) program’s Federal Insurance Contributions Act (FICA) taxes for employment and Self-Employment Contributions Act (SECA) taxes for self-employment, including the Medicare portion of these taxes. If an individual is exempt from U.S. Social Security coverage under this Agreement, the employee or employer's share of the FICA tax is not due as long as the exemption is in effect. A self-employed person is exempt from paying SECA taxes (equivalent to the employee and employer shares of the FICA tax) for any period the exemption is effective.

The U.S. laws to which the Agreement applies are Title II of the Social Security Act except section 226 (Medicare benefits), 226A (Medicare coverage for certain persons suffering from renal disease) and section 228 (special age-72 payments-prouty benefits). Hospital insurance under Medicare has been excluded. Individuals to whom the Agreement applies, who qualify independently for Medicare hospital insurance benefits, would be entitled to receive such benefits.

For Italy, the Agreement applies to social security coverage and taxes that finance retirement, survivors and disability benefits, as well as family allowances. Consequently, if an individual is exempt from Italian coverage because of the Agreement, no contributions are due under any of these programs. However, a worker may still have to pay contributions for other types of Italian benefits financed through social security taxes such as cash sickness, maternity, and unemployment benefits, etc.