China has a tax treaty but no totalization agreement — so self-employment tax stays.
There is a US–China income tax treaty, and Chinese individual income tax is progressive to 45%, so the foreign tax credit is usually available and often better than the exclusion. There is no totalization agreement, which means US self-employment tax at 15.3% applies with no relief.
Tax snapshot — China
Scroll the table sideways
Sources: IRS Publication 54; IRS Publication 901; US–China income tax treaty (1987); SSA totalization agreement list; Rev. Proc. 2025-32. Checked 28 August 2026.
What that means on your return
The split matters: a treaty relieves double income tax, a totalization agreement relieves double social security. China has the first and not the second. An employed American is usually fine; a self-employed one pays SECA on top of whatever China takes.
Individual income tax is withheld monthly and reconciled annually, and the annual reconciliation can produce a refund that changes the foreign tax credit you already claimed. Amended positions are common here and worth expecting rather than fearing.
Mandatory social insurance contributions are not income taxes. They do not go on Form 1116, and with no totalization agreement they buy no relief from US self-employment tax either.
If you are in China as a…
Questions I get about China
China has a treaty. Why do I still pay self-employment tax?
Because a tax treaty and a totalization agreement are different instruments. The treaty addresses income tax; only a totalization agreement can relieve US self-employment tax, and China has none. Net self-employment income stays subject to 15.3% SECA.
Are my Chinese social insurance contributions creditable?
No. They are not income taxes, so they do not belong on Form 1116, and they do not relieve SECA.
Should I claim the exclusion or the foreign tax credit in China?
It turns on your effective local rate. Where local tax is high the credit usually beats the exclusion and leaves your income counted for IRA purposes; where it is low the exclusion usually wins. Revoking the exclusion binds you for five years without IRS consent, so it is decided deliberately — that comparison is what the position review is for.
When is my return due?
15 June, under the automatic extension for filers living abroad. Form 4868 moves it to 15 October, and I file the extension free.
Do I have to file an FBAR for my Chinese bank account?
If your foreign accounts together passed $10,000 at any point in the year, yes. You can file it free through FinCEN's own system. The non-willful penalty for not filing is $16,536.
I have not filed for several years. What now?
The Streamlined Foreign Offshore Procedures: three returns, six FBARs and Form 14653 certifying non-willfulness. Penalties are waived. Note that the IRS terminated the separate Delinquent FBAR Submission Procedures around 1 July 2026.
Filing from China this year?
Twenty minutes with the Enrolled Agent who will prepare and sign it. Complete return, $599.
An IRS Enrolled Agent working only on US tax for Americans living abroad. I prepare and sign every return myself — 17 years in practice, 12 of them as an Enrolled Agent.