A certificate of coverage issued by an agreement country serves as proof that the
designated worker is exempt from U.S. Social Security coverage and taxes. If the worker
is an employee, the foreign certificate should be retained in the office of the U.S.
employer in case the Internal Revenue Service (IRS) questions why the company is not
withholding and paying FICA taxes for the worker. If the worker is self-employed,
a photocopy of the certificate must be attached to the U.S. income tax return the
worker files each year to prove the employee's 's exemption from SECA taxes.
SSA sends duplicate copies of the certificates of coverage it issues on behalf of
qualified U.S. employees to the requesting U.S. employers. It is the employers' responsibility
to make a copy available to the tax authorities in the other country, if requested
to do so, in order to prove the employee's 's foreign tax exemption.