My friend came to US in Aug 2007 on F-1 visa. So I understand that his 5-years end in 2011, and he would be a resident alien from Jan 2012.

He will be filing f1040nr and f8843 for the last time for 2011, and will start filing f1040 from 2012 onwards.

However, I had a few questions for the time he will be on F-1 or F-1 OPT in 2012:
- Will he have to pay FICA taxes (social security and medicare)?
- Would the bank interest be taxable or exempt from taxes?

Thanks!

If he is paid wages or is self-employed the money would be subject to FICA. If his income is a scholarship, that would not be subject to FICA. Bank interest is taxable to resident aliens

He becomes liable for FICA (Social Security and Medicare) tax withholding on 1 January 2012.

The bank interest becomes taxable on 1 January 2012; prior to that date, it is tax-exempt.

I was afraid that this would be the case... Thanks for confirming that...

Glad to help!