Over the years, a number of EU regulations have looked at the coordination of social security systems. The current EU regulations, i.e. Regulation (EC) No. 883 of 2004 relating to the coordination of social security systems and Regulation (EC) 987 2010 relating to the procedure for the application of Regulation (EC) No. 883 of 2004, which came into force on 1 May 2010 and replaced Regulation (EC) No. 1408 of 1971 and Regulation (EC) No. 574 of 1972. Several bilateral agreements were concluded between Ireland and the United Kingdom, the first of which were concluded before Ireland and the United Kingdom joined the European Economic Community (EEC) in 1973. These previous bilateral agreements were consolidated in the new agreement, which came into force on 1 October 2007, and this agreement applies mainly to people who have worked in parts of the UNITED Kingdom who are not part of the EU, namely the Isle of Man and the Channel Islands (Jersey, Guernsey, Alderney, Herm and Jethou). Although the agreement between the United States and Ireland allows the Social Security Administration to count your Irish loans to help you qualify for pension, disability or survival benefits in the United States, the agreement does not cover Medicare benefits. Therefore, we cannot count your credits in Ireland to justify the right to free Medicare hospital insurance. Step 1: Your fictitious pension is calculated. The fictitious pension is the Irish pension rate that should be paid if your social security contributions, both Irish and non-Irish, were treated as Irish contributions.
To obtain the average annual number of contributions, your annual contributions are added up and the sum is divided by the number of years (i.e. the number of years of your first social contribution paid until the end of the tax year before retirement age (66). As a general rule, a person should claim a pension entitlement in the country of residence. A person residing in Ireland should therefore apply for a pension from the Ministry of Social Welfare. If the applicant indicates that he or she was insured (or, if necessary, resident) in a country with which Ireland has a bilateral agreement, a pension entitlement is opened in that country by the department that addresses the relevant agency on behalf of the applicant. The date of receipt of the claim and all relevant documents must be immediately forwarded to the institution of the other country. The same procedure applies on the other hand when the right to the pension is introduced in another country, but the person has social security contributions in Ireland. Note As shown in the table, an American worker employed in Ireland can only be covered by U.S. Social Security if he or she works for a U.S. employer.
A U.S. employer includes a company organized under U.S. or state law, a partnership if at least two-thirds of the partners are based in the United States, a U.S.-based person or a fiduciary company if all agents are established in the United States. It is also a foreign subsidiary of a U.S. employer when the U.S. employer entered into an agreement with the Internal Revenue Service (IRS), pursuant to Section 3121 (l) of the Internal Revenue Code, to pay Social Security taxes for U.S. citizens and residents employed by the subsidiary. The “fictitious pension” is calculated. The fictitious pension would be payable if all tainted social security contributions, both Irish and non-Irish, were treated as Irish contributions. Irish and non-Irish contributions and computable credits are therefore added up, and the sum is then divided by the total number of years in order to obtain the average annual number of contributions.
The “fictitious pension” is the appropriate personal rate plus the increase for qualified adults, if any without increases of more than 80 allowances or increases living alone.