US freelancer in Bulgaria — am I really paying into two social security systems at once?

Your accountant is right, unfortunately, and this is the single most expensive surprise for self-employed Americans in Bulgaria. The income tax treaty and social security are two separate worlds. The treaty (plus the foreign earned income exclusion and foreign tax credits) handles income tax. Social security coordination requires a totalization agreement — and the US and Bulgaria do not have one, with none on the horizon. The consequences: US self-employment tax of 15.3 percent follows your net freelance profit wherever you live, and neither the FEIE nor foreign tax credits can offset it. Simultaneously, as a Bulgarian self-insured person you owe Bulgarian contributions on your insurable income up to the 2,300 euro monthly cap. You pay both, and the years do not cross-credit: Bulgarian contributions earn you nothing toward the 40 US credits, and vice versa. The one mild consolation is that both systems cap out — Bulgarian contributions at roughly 640 euro a month, and you may end up drawing small pensions from both systems eventually. The legal mitigation people discuss is structural: if you operate through a Bulgarian EOOD instead of as a sole self-employed person, your income stops being self-employment income for US purposes — it becomes salary and dividends from a foreign corporation, which are not subject to SE tax. But you have then acquired a US-owned foreign corporation, with GILTI rules, Form 5471 filings and real complexity; done carelessly it costs more than it saves. This is genuinely a case for a US expat tax specialist who has run the numbers for Bulgaria specifically, not a generic preparer. Background on the Bulgarian side: /guides/bulgaria-tax-guide-for-foreigners.