Hi Tax Experts
I am an Indian national. came to US on F1 in Jan04. graduated with MS in aug 06. was working in opt till oct07 and from oct 07, H1b. my questions:
1. My HR did NOT deduct my SS and medicare taxes from oct07 to dec07. How can I pay that to irs?
2. after going thru this forum I think I can use 1040 nrez (not sure though,need clarification).
should i file as non-resident alien? please help!!!
3.and i live in illinois, i assume i will pay the state taxes as i used to pay when as student last year with no changes to form. is it right?
tax experts please help!!!:confused:
regards
basu

Basu:

1) YOU are not required to pay it; your employer must make these payments. Tell the HR department IN WRITING (email is a good option for this) that you became liable for SS and Medicare taxes on 1 October 2007 and request that they correct this problem. Keep a printed copy of that email. They can still fix it with the IRS without penalty if they act by COB this Thursday.

Once you have made that notification, you have fulfilled your legal obligation.

2) Agreed; if you are NOT married, you should file Form 1040NR-EZ PLUS Form 8843 ONE LAST TIME. For 2008, you wil file as a resident alien.

3) Yes, you will owe Illinois state taxes on the income you have earned as a part-year resident. You lost your non-resident/student status on 1 October 2007.

Thanks so much Atlanta tax expert!!!
yes I notified my HR in october it self...she did not bother to change then. i've reminded her last week too when i got my w2 form. she told she will take care of it by the end of the month(may be she knew). i was just scared thinking i must owe lot of mony to irs.
any ways thanks again so much
regards
basu

You MAY in fact owe money. The employer has the legal obligation to PAY the FICA taxes. They can then come back to you and ask you to pay your share of them.

If that happens, you are both legally and morally required to pay your share, for, after all, the taxes WERE due.

But I would NOT hold my breath if I were you. The employer screwed up here, and the IRS will impose a significant fine for failing to pay these taxes on time.

Once they realize how much the fine will be (it is spelled out rather clearly in the IRS pubs), many (but not all) employers simply choose to ignore the problem and HOPE the IRS does not notice.

More time than not, the IRS does NOT notice.

BUt NONE of that is YOUR business! It is the business of the EMPLOYER!! If you stick your nose in it, you may end up getting terminated from your job for being an honest individual.

That is why I told you to keep a copy of that email. If the IRS determines that you owed FICA taxes that were NOT paid, they will NOT come after you; they will go after the EMPLOYER as the people responsible to pay those taxes. The employer's only defense (and it is a FLIMSY defene at that) is that they were ignorant of the requirement to withhold FICA taxes from your pay for the 1 Oct to 31 Dec 07 period.

The email effectively refutes that contention!

You will file your 2007 return as nonresident. You will get exemption of $3,400 and, as per tax treaty, you will get standard deduction of $5,350.

Noted!

Thanks so much for the quick replies!!!
also had a question. I have an HSA account and I got form 1099-SA. what should I do with it?amount $449
actually I transferred the amout from my old HSA to new HSA account as my company changed the service provider. the old provider sent me form 1099sa.
i did not get anything from the new provider as i did not use any hsa money at all.
please clarify
regards
Basu

If you do not know what to do with the Form 1099-HSA, you need to go to a tax preparer who does know, as it does need to be reported,