Hi there,

When on OPT status from Oct 1, 2005 till Oct 1, 2006, I notified my employer not to withhold SS and Medicare taxes from my paychecks.

When I switched to H1-B status in Oct 1, 2006, both my employer and I failed to start to take SS and Medicare out of my paychecks. Upon this discovery, my employer has been advised by the company's lawyer to pay back these taxes. However, they have not told me how much I owe.

My questions are:
1. Who are eligible to pay SS and Medicare taxes? What are the implications if no such taxes were made to the government? (A foreigner like I am is not likely to stay in USA forever, thus will not be eligible to take SS and Medicare benefits when we got older, if so, then why is the SS and Medicare taken out from our paychecks?
2. How much % is taken out of our income for SS and Medicare deduction?
3. If I owe back taxes, will I have to pay interest for the back taxes?
4. Will the company be fined for not paying those taxes back in 2006-08?
5. Is there a better solution that I can have for my situation?


Thank you for the help.

1) You are liable for the Social Security and Medicare taxes, but only in the year they are due. If the taxes are NOT collected in a timely manner, your liability ends. That is probably why your employer has not collected them.

2) SS: 6.2%. Medicare: 1.45%.

3) No; see #1 above.

4) Yes, probably.

5) You need to leave it to the company to resolve.