How to claim exemption of FICA? Should we file jointly, if we do, how to claim FICA.

Yes, you can file joint return as residents if you are resident. Which return did you and your spouse file in 2010?

We filed joint in 2010. Then she did not have a job. In 2011.she started work and had wages. The employer has not cut any SSN and Medicare on her pay as they were aware of the FICA exemption rules for F1 students. However when I am filing this time I notice that the online software such as turbo tax and taxact do not consider this FICA exemption rule and they deducted it from the final refund as something I owe. Any ideas on how to file?

Also, we did file as residents.

NEITHER TurboTax nor TaxAct determine FICA tax requirements if you are filing as W-2 employees.

Now, if she is filing under Form 1099-MISC, then they WILL calculate the self-employment tax.

If she IS working under Form 1099-MISC, then the ONLY way to avoid payingthe self-employment tax is for you to file separately, you as a resident (If you were under H-1B for ALL of 2011) and she as a non-resident (filing Form 1040NR and Schedule C).

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