New US immigrants to Israel no longer need to double-pay social security, under new law |
New immigrants arriving from the United States in the next five years will not have to double-pay social security, under new legislation approved in the Knesset plenum Wednesday night.
The new law removes one of the most frustrating financial obstacles to immigration, after decades of lobbying, immigration organizations said.
Currently, US immigrants who are self-employed — meaning they own businesses known in Hebrew as osek murshe or osek patur — are required to pay both National Insurance in Israel and Social Security in the United States. In most cases, that means self-employed workers lose an extra 15 percent of their reported income by paying social security to both countries, due to a hole in the Israel-US tax treaty.
Under the new law, which applies retroactively to the beginning of 2026, new immigrants who pay US Social Security will be exempt from paying National Insurance in Israel for their first five years. New immigrants who have arrived in recent years are also exempt for the remainder of their first five years as of January 1, 2026.
Salaried workers are already exempt from paying US Social Security by the tax treaty, so the new law does not apply to them in most cases.
“This legislation corrects a real structural unfairness,” said Jeremy Saltan, an adviser for the ruling Likud party who helped advance the legislation. “By removing the burden of double social security payments, we make aliyah [immigration to Israel] more economically viable for working families and professionals abroad.”
The law, initiated by Religious Zionism MK Simcha Rothman along with that party’s Ohad Tal and Yesh Atid’s Meirav Ben Ari, was approved 13-0 in its second and third readings in the Knesset.
“The bill passed from one Knesset to another, and many Knesset members, including myself, tried to promote it in the past but encountered many difficulties,” Rothman said. “Now I call on our brothers overseas: Come and immigrate to Israel.”
Under the legislation, the National Insurance Institute will be refunded by the Treasury for the losses it incurs under the arrangement. The law was approved as a 10-year temporary provision, and can be renewed in the future for two five-year periods.
The Social Security tax rate for self-employed workers in the US is currently 15.3%. The rate Israelis pay for National Insurance varies, and different estimates were presented in Knesset debates, but the average is around the ballpark of 15%, Saltan said.
The exemption does not include health insurance contributions, which are deducted separately.
Immigration organizations said they were extremely pleased with the legislation.
“Over the past two decades, we have identified the issue of double payment of National Insurance as a significant hurdle for aliyah, due to the financial burden it has caused during the initial critical absorption period of olim,” said Natah Katz, head of the Post Aliyah & Advocacy Division of Nefesh B’Nefesh, noting that the organization had worked with policymakers for years on the issue. “The approval of this law marks an important step forward and reflects the State of Israel’s recognition of the needs of new olim.”
Dov Lipman, founder of Yad L’Olim and a former MK, also applauded the decision.
“We have had conversations with MK Rothman about this and other issues, and thank him for seeing this through,” he said. “We firmly believe that the more olim that come to Israel, the better it is for Israel on multiple levels. Therefore, we support any legislation that makes it easier for olim during their first few years in Israel,” he said, using the Hebrew word for immigrants to Israel.
Israeli lawmakers have been working to minimize obstacles to immigration, putting forth numerous new initiatives in recent years. In November, they announced that new immigrants and returning residents arriving in 2026 will have a zero-percent income tax rate for their first two years after moving to Israel.
About 3,500 immigrants came from the US in 2025, an increase of 5% from the previous year and up 30% from 2023, the Immigration and Absorption Ministry says.
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immigration to Israel