I was on my OPT from Jan 2005 till Oct 2005 in Texas. I switched to H-1 in October. I have received a 1099 for wages received under OPT and no federal tax has been withheld. Am I liable to pay federal tax when I am under OPT?

IndianH1:

Yes, you must pay federal income taxes on this money.

You need to complete Schedule C to account for the income and claim any expenses you incurred as deductions. You attach the Schedule C to Form 1040NR, and transfer the net income (amount of Form 1099 minus the valid deductions) on Line #13 of Form 1040NR.

You are also liable for state income taxes unless you live in one of six/seven states that have no income tax.

You do not have to pay self-employment taxes (Schedule SE).