Hi,


We've hired a summer intern to work 40 hours a week, with a weekly stipend of $100 in our California-based offices. I have a 2 part question:

1. I know that F-1 students (working as part of Curricular Practical Training) are exempt from FICA Med, and FICA SS, and FUTA (unemployment), but what about Cali state taxes?

2. He'll most likely not make more than $3000 this summer (I read that any income below $3000 is not considered "taxable income"). But if we hire him as a full-time employee for the fall, then what changes as far as taxes/exemptions are concerned?

Any help would be great.

Thanks!

I just found out the answer by calling the California EDD and thought I'd share what I learned.

First, F-1 visa students working for a for-profit, commercial organization are treated like regular employees--whether they are working part-time or full-time. Any income over $100 is considered taxable by the state of California. This means:

1) The employer must pay for Unemployment and training taxes.
2) And the F-1 employee pays Disability (SDI) and Personal Income Income (PIT)

Most of the wages withheld (SDI and PIT) will be given back at the end of the year to the employee.

Note that if the student is working for a religious organization or working for a non-profit, this doesn't apply. It's only if the student is working for a commercial, regular business.

Hope this helps!