Do US olim still have to pay Bituach Leumi?
Many qualifying US olim no longer pay the Bituach Leumi national-insurance contribution for their first five years here, but they still owe the separate health levy. The reason this question even exists is cross-border: unlike the UK, Canada and dozens of other countries, the United States has no social-security totalization agreement with Israel5. So a US oleh who keeps paying into US Social Security can be charged twice on the same paycheck, once by the IRS and once by ביטוח לאומי (Bituach Leumi). A 2026 amendment to the National Insurance Law is meant to relieve the Israeli side of that double charge 4.
Not advice
Almost every new American oleh is blindsided by the same thing: in the US, your Social Security and Medicare taxes are the only social tax you face. In Israel, Bituach Leumi looks like the same idea wearing a different name, so it feels like you are simply switching systems. You are not. For five long-promised but never-signed decades, a US oleh who kept a US income source kept paying US Social Security and, on becoming an Israeli resident, also owed Bituach Leumi on income, with no treaty to credit one against the other.
Why does no totalization agreement mean double social tax?
A totalization agreement is the treaty that stops two countries from both taxing the same wage for social security. Where one exists, it assigns your social-tax home to one country and exempts you in the other, and it lets you combine credits across borders for a future pension. The US has signed totalization agreements with roughly 30 countries5, but Israel is not one of them, and decades of on-and-off negotiation never produced a signed deal.
The practical effect lands hardest on two groups. A self-employed oleh who is a US citizen owes US self-employment tax to the IRS on worldwide net earnings and, as an Israeli resident, owes Bituach Leumi on the same earnings. A US oleh still on a US payroll whose employer keeps withholding FICA is in the same bind. There is no treaty mechanism to credit the US contribution against the Israeli one or the reverse, which is exactly the gap the 2026 law targets.
What does the 2026 Bituach Leumi exemption actually do?
The 2026 amendment exempts qualifying olim who are obligated to pay US Social Security from the Bituach Leumi national-insurance contribution for five years from the aliyah date 4. The relief covers the social-insurance side of the bill: the contributions that fund old-age, disability, maternity and the other Bituach Leumi branches. It is structured as a time-limited measure and is administered through the National Insurance Institute, so eligibility is checked against your US Social Security obligation rather than granted automatically to everyone with a משרד הקליטה (Misrad HaKlita) certificate.
Two limits matter before you celebrate. First, this is the Bituach Leumi contribution only, not your US bill: you still owe US Social Security or US self-employment tax to the IRS on the same income, because the exemption is a one-sided Israeli measure, not a treaty. Second, it runs for five years from aliyah and is income-linked to your US obligation, so a year in which you are not subject to US Social Security is a year the exemption has nothing to relieve.
| Charge | Before 2026 | Years 1–5 after aliyah (qualifying oleh) |
|---|---|---|
| US Social Security / self-employment tax (IRS) | Owed | Still owed (US side unchanged) |
| Bituach Leumi national-insurance contribution | Owed | Exempt for five years from aliyah4 |
| Health levy (mas briut, via Bituach Leumi) | Owed | Still owed, min. NIS 123/month if no income2 |
Why is the health levy still owed even when Bituach Leumi is exempt?
Because the health levy is a different charge under a different law. Israel collects two separate things on one Bituach Leumi statement: the national-insurance contribution and the health contribution, the מס בריאות (mas briut) (health levy) that funds your קופת חולים (kupat cholim) under the State Health Insurance Law. That law makes health coverage compulsory for every Israeli resident3, and the 2026 exemption deliberately leaves it untouched. A US oleh who keeps a US income source is exempted from the national-insurance contribution but continues to pay the health levy, because the relief was designed not to disturb the health-system funding.
For a resident with no Israeli income, the health levy bottoms out at a minimum of NIS 123 per month (as of 1 January 2026) 2. With income, the levy runs at 3.23% on the portion up to 60% of the average wage and 5.17% above it 2. None of that is removed by the national-insurance exemption.
How does the separate 6-month olim exemption fit in?
Distinct from the US-Social-Security exemption, every new oleh with no income already gets a short health-contribution holiday. A new oleh with no income, or income below NIS 688 (as of 1 January 2026), is exempt from the health contribution for a 6-month period from the day of aliyah, extendable to 12 months if you receive subsistence benefits from Misrad HaKlita and file the recipient certificate with Bituach Leumi 1. That is a universal first-year cushion for anyone arriving without earnings, and it is unrelated to whether you pay US Social Security.
So the two reliefs stack on different clocks. From roughly month one to month six, a no-income oleh pays neither contribution. Once income starts, or month six passes, the health levy switches on for everyone, while the five-year national-insurance exemption keeps sheltering a qualifying US oleh from the Bituach Leumi contribution alone.
How do you register and claim the exemption?
You claim nothing until you are inside the system, so register first, then apply. The order below names the institution responsible for each step.
- Register with Bituach Leumi and a kupat cholim. Choose your קופת חולים (kupat cholim) at the airport, at a post office, or online through the Bituach Leumi portal from about three weeks after arrival; do it within 90 days of aliyah or you will have to register in person at your local branch 1.
- Establish your status with the Israel Tax Authority if self-employed. A self-employed oleh opens a file as an עוסק מורשה (osek murshe) (or osek patur below the VAT threshold), which is what makes you liable for the Bituach Leumi contribution the exemption then removes.
- Apply to Bituach Leumi for the US-Social-Security exemption. Bring evidence that you are obligated to pay US Social Security or US self-employment tax, pay stubs showing FICA, a W-2, a US Schedule SE, or an employer letter, plus your תעודת עולה (teudat oleh) and aliyah date 4.
- Keep paying the health levy. The exemption letter covers the national-insurance contribution only; the health contribution continues, and you stay registered with your kupat cholim throughout 3.
How does this differ by where you made aliyah from?
Whether you face the double-charge problem at all depends on your passport, because the US is the outlier without a totalization treaty.
A note on pooled funds (PFIC)
Quick check
A qualifying US oleh receives the 2026 Bituach Leumi exemption. Which charge do they still owe in Israel?
Because there is no US-Israel social-security totalization agreement, a US oleh who keeps paying into US Social Security (FICA or US self-employment tax) can be charged twice on the same income: once by the IRS and once by Bituach Leumi. A 2026 amendment to the National Insurance Law exempts qualifying olim who are obligated to pay US Social Security from the Bituach Leumi national-insurance contribution for five years from the aliyah date. The relief is not automatic, it does not touch the US side, and it does not cancel the separate health levy (mas briut), which every Israeli resident still owes (a minimum of NIS 123 per month for someone without income). It helps the self-employed and olim kept on a US payroll most; a salaried oleh whose US FICA stopped at aliyah was never double-charged.
No. It is granted through the National Insurance Institute against proof that you are obligated to pay US Social Security or US self-employment tax, not automatically to every oleh. You apply with your FICA or Schedule SE evidence, your teudat oleh, and your aliyah date. Separately, the universal 6-month no-income health-contribution exemption is applied when you register.
No. The 2026 amendment is a one-sided Israeli measure with no effect on US law. Because there is no US-Israel totalization agreement, you continue to owe US Social Security or US self-employment tax to the IRS on the relevant income. The exemption only removes the Israeli Bituach Leumi contribution, not the US side.
Five years from the aliyah date for a qualifying oleh who is subject to US Social Security. It is income-linked, so a year in which you are not subject to US Social Security is a year it has nothing to relieve. After year five the ordinary Bituach Leumi contribution rules apply like any other resident.
Probably not, and that is fine, because you were likely never double-charged. If your US FICA stopped when you moved onto an Israeli employer’s payroll, you only pay Israeli Bituach Leumi, with no second US social tax to relieve. The exemption matters for olim still inside US Social Security: the self-employed and those kept on a US payroll.
After any 6-month no-income health holiday ends, the health levy bottoms out at a minimum of NIS 123 a month as of 1 January 2026 for a resident without income. That floor is the health contribution, which the US-Social-Security exemption does not touch. The national-insurance contribution is the part the five-year exemption removes.
No. Bituach Leumi contributions and Mas Hachnasa (income tax) are separate systems. The 2026 exemption is about social-insurance contributions only. Your Israeli income-tax position, including the 10-year exemption on foreign-source income for new residents, which became report-but-still-tax-exempt from 1 January 2026, is governed by entirely different rules.
Use the National Insurance Institute for the live figures: the new-olim contributions page for the registration and 6-month rules, and the health-rates page for the NIS 123 minimum and the percentage bands. Because the 2026 amendment is administered case by case and details can be refined by regulation, confirm your own eligibility with Bituach Leumi or a cross-border accountant before relying on it.
