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qlai · Oct 22, 2009, 08:23 AM

I was on a F1 visa from 1996-2007. Between 2007-2008, I was on OPT through my F1 visa. Beginning March 2008, I've been on a J1 visa as a research scholar. My J1 visa will expire in March 2013. I've been paying city, state, and federal taxes as a resident since 2002. Am I exempt from paying social security and Medicare? The IRS publications I've read online state that J1 visa holders are exempt for the first 2 years. Does this mean the first 2 years of the J1 visa regardless of the fact that I've held a F1 visa for the previous 11 years? Or does that mean the first 2 years out of the total number of years that I've been in the US? Please help! The online publications I've come across have proven confounding, to say the least.

AtlantaTaxExpert · Oct 22, 2009, 01:16 PM

The F-1 visa for the previous 11 years definitely affects the exempt status on your J-1 visa, in that you have NO exempt status at all UNLESS you returned to your home country to re-establish residency status.

The timeline posted indicates that you did NOT return to your home country. Given that fact, plus the duration of your F-1 visa status plus the fact that you have been paying taxes as a resident alien since 2002, I would say you have NO CHANCE of convincing any IRS auditor that you qualify for tax exemption under your J-1 visa.

qlai · Oct 22, 2009, 01:28 PM

Thank you! I figured there was no way I could be exempt. I did go back to my home country between the OPT and J1 for approximately a month but I doubt that re-establishes residency status. I just wanted a definitive answer. I've been telling my employer to just take out Social Security and Medicare to make things simple and make the problem go away but HR has been going back and forth without actually doing anyway or working on getting a definitive answer so that this issue can be settled for good. Once again, thank you for your help.

MukatA · Oct 23, 2009, 04:21 AM

On F1 you are exempt for 5-years that is from 1996 to 2000.
From 2001 you are resident in the U.S. and must file resident return. Even on F1/OPT, you must pay SS tax and Medicare tax. You do not get any treaty benefit.

AtlantaTaxExpert · Oct 23, 2009, 07:50 AM

You are correct: one month is NOT enough time to re-establish residency.

The norm is at least one YEAR!