Hey AtlantaTaxExpert. I appreciate the time you put into answering all these questions. An oversignt on mine and my employers part has caused a giant mess.

I was on OPT from January onwards, working for my company. I was on H-1 beginning July 22nd 2005. Initially they had agreed to not take out my social security and medicare taxes, which they did after a month or two. Unfortunately they also blocked withdrawal of federal taxes from my salary, which I didn't realise.

After my status switched, I forgot to restart the SS and Medicare tax withdrawal. Consequently, virtually no fed, SS or medicare taxes have been taken out from my salary all year! I suddenly find myself with a very large sum to pay to the IRS. Given my part F1, Part H1 status etc, what would be the best way for me to file my taxes? I would appreciate any tips on reducing how much I owe and claiming as many deductions as possible.

Also, I am in atl myself, and was wondering if there's any way I could get in touch with you directly. Thanks in advance.

Hi,
I am not a tax expert, nor a CPA. But, I do use a CPA to do my taxes, costs a little less than $150 for both Federal and State taxes.
There are forms to use which I have never used, much more complicated than just the normal forms.
I do suggest talking with a CPA and getting an approximate cost of doing yours. The money you save might be well worth it.

You can contact me at [email protected]; I do not post my phone number on public forums.

The non-withholding of your federal income taxes may cause some problems in that you will have to write a check when you file your return. There may be some under-withholding penalties, but they are not extremely large.

As for the failure of your employer to withhold Social Security and Medicare taxes, that is exclusively his problem.

The IRS position on this matter is clear: the withholding and payment of these employment taxes is the exclusive responsibility of the employer. If they fail to withhold the taxes from your check, they can debit your check to make up for that failed withholding, but only for a limited time. I believe the window to ask you for the past withholding has in fact passed. If the employer fails to withhold the Social Security and Medicare taxes from the employee, he/she is then obligated to pay both sides (employer and employee portion) of the Social Security and Medicare taxes.

The only way the employer can put the blame on you is if he can show you intentionally hid the change in your visa status. Since most H-1 visas are submitted with the coopertaion and sponsorship of the employer, it would be rather difficult for the employer to claim you failed to notify him of the visa status change. The INS, as a matter of routine, would have notified him of the change even if you had failed to do so.

Send me an e-mail to detail the amount of money we are discussing, but, offhand, I would not worry about the Social Security and Medicare taxes not being withheld. Your employer is one who has to worry about that.

Hi,
If your employer has NOT paid Social Security taxes on you, then I highly recommend contacting your employer and get it straightened out. As the answer said, it's their problem.
But, it will be your problem on down the line when you are ready to retire, to begin receiving the normal Social Security Retirement monthly income. If that has not been paid, your monthly check will be somewhat less.

Thanks for the replies guys. Much appreciated. Any tips on additional deductions to reduce the fed income tax I owe?

I have answered your e-mail!

Quote:

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Originally Posted by fredg

I do use a CPA to do my taxes, costs a little less than $150 for both Federal and State taxes.

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See, there is a need for us bean counters :p