Bituach Leumi for Americans: rates and rules

If you live in Israel, you pay Bituach Leumi, whether you have a job, run a business or don't work at all.

The short version

Bituach Leumi is the National Insurance Institute (NII). It collects two contributions: national insurance (pensions, unemployment, maternity and more) and health insurance, which funds your kupat holim [1].
Employees in 2026 pay 4.27% on wages up to ILS 7,703 a month and 12.17% above that, up to a ceiling of ILS 51,910 a month [1].
The self-employed pay 7.7% and then 18% across the same bands [2]. People with no income pay a minimum of ILS 266 a month [3].
New immigrants with little or no income can be exempt from health insurance contributions for six months, extendable to 12 in some cases [4].
There's no US–Israel totalization agreement [5]. Some Americans owe both Bituach Leumi and US Social Security tax on the same income.

USD conversions in this guide use the European Central Bank reference rates of October 29, 2026, a cross rate of about ILS 3.12 per USD.

What Bituach Leumi is

Think of Bituach Leumi as Social Security, unemployment insurance and part of Medicaid rolled into one agency. It pays old-age pensions, child allowances, unemployment, maternity benefits, disability and work-injury benefits. It also collects the health insurance contribution that funds Israel's four health funds, which is why your kupat holim membership is tied to your Bituach Leumi status.

The obligation follows residency, not citizenship. If your life is centered in Israel, you're generally an insured resident and must pay. Americans on work visas, olim (new immigrants) and returning residents are all in the system. Tourists are not.

The amount depends on your situation: employee, self-employed, or not working. Each band is set in shekels and updated every January.

2026 rates for employees

If you're on an Israeli payroll, your employer withholds your share from your paycheck and adds its own. These rates apply from January 1, 2026, for ages 18 to retirement age [1]:

Monthly wage	National insurance (you)	Health insurance (you)	Your total	Employer pays
Up to ILS 7,703 (about USD 2,470)	1.04%	3.23%	4.27%	4.51%
ILS 7,703 to ILS 51,910 (about USD 2,470 to 16,660)	7%	5.17%	12.17%	7.6%

The lower band is 60% of Israel's average wage. Income above ILS 51,910 a month (about USD 16,660) isn't subject to contributions [1]. The ceiling is updated each January.

A ballpark example: on a monthly salary of ILS 20,000 (about USD 6,420), you'd pay 4.27% on the first ILS 7,703 and 12.17% on the rest. That's roughly ILS 1,830 (about USD 585) a month. Your pay slip (tlush) shows both lines.

2026 rates for the self-employed

Freelancers and business owners (atzmai) register with Bituach Leumi themselves and pay advances, usually monthly. From January 1, 2026 [2]:

Monthly income	National insurance	Health insurance	Total
Up to ILS 7,703 (about USD 2,470)	4.47%	3.23%	7.7%
ILS 7,703 to ILS 51,910 (about USD 2,470 to 16,660)	12.83%	5.17%	18%

There's a floor. If your self-employed income is below ILS 3,442 a month (about USD 1,105), you pay as if you earned the minimum [2]. Different rates apply under 18 and at retirement age, so check the NII page if that's you.

Bituach Leumi sets your advances from an estimate and reconciles them later against your tax assessment. If your income jumps or drops, update your estimate rather than waiting for a big bill.

2026 rates if you're not working

This one surprises Americans. If you live in Israel and don't work, you still owe contributions. From January 1, 2026 [3]:

No income at all: a minimum of ILS 266 a month (about USD 85). That's ILS 143 national insurance plus ILS 123 health insurance.
Non-work income such as US rent, pensions or investment income: the first ILS 3,442 a month (about USD 1,105) is exempt. Income up to ILS 7,703 is charged at 12.09% and income above that, up to the ceiling, at 12.17% [3].

Some groups have special rules, including students, homemakers married to an insured person, and people receiving pensions. If you retire to Israel on US income, sit down with the NII rules or a local accountant before assuming you're exempt.

Rules for new immigrants

New olim get a short break on health insurance contributions. According to the NII, a new immigrant (including a returning minor or a citizen oleh) with no income, or income below ILS 688 a month (about USD 220) in 2026, may be exempt from health insurance contributions for 6 months from the date of aliyah [4]. That can be extended by another 6 months, for 12 in total, but only for months in which the Ministry of Aliyah and Integration pays you subsistence benefits. You have to bring the NII a certificate showing those payments; the extension isn't automatic [4].

Once you start working, contributions start. Your employer handles it if you're on payroll.

A few practical steps:

Register with a health fund at the airport or within 90 days of aliyah. After 90 days, you'll need to go to an NII branch [4].
Check your NII status online once your details reach the system, about three weeks after arrival [4].
Claim child allowance if you have kids. The Ministry's guide notes it can start from the first month of aliyah [6].
Set up a payment arrangement as the exemption ends, so debts don't build up quietly.

For a wider look at what olim receive, see our aliyah guide.

No totalization agreement: what it means for Americans

The US has totalization agreements with 31 countries. They decide which country's social security system you pay into, so you don't pay twice. Israel isn't on the list [5].

That gap matters in two common situations:

You're self-employed. US citizens owe US self-employment tax if net self-employment earnings are $400 or more, wherever they live. The foreign earned income exclusion doesn't reduce it [7]. Without an agreement, there's no certificate of coverage to exempt you. So an American freelancer in Tel Aviv can owe both Israel's 18% top rate and US self-employment tax on the same profit.
You work in Israel for a US employer. An American employer generally keeps withholding FICA, and Israel may also require Bituach Leumi contributions. Double coverage is common here.

If you work for an Israeli employer, you generally pay only Bituach Leumi on that salary and don't build US Social Security credits from it.

What about credits toward benefits? With no agreement, you can't combine Israeli and US work years to qualify for either pension. Each system looks only at its own record. If you're short of the 40 credits US Social Security generally requires for a retirement benefit, Israeli years won't fill the gap.

Taxes are a separate question. The IRS bars a foreign tax credit or deduction for social security taxes paid to countries that have a social security agreement with the US [8]. Israel doesn't, so that bar doesn't apply, and Bituach Leumi contributions may be creditable on your US return in some cases. It won't cancel US self-employment tax, though, because the credit only offsets income tax. A US expat tax preparer can check your situation, especially if you're self-employed.

If you want to compare notes with other Americans on payroll and freelancing questions, our community group for Americans in Israel is a good place to ask.

Bituach Leumi: what Americans in Israel pay for national insurance