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hashashyin · Sep 17, 2007, 04:55 PM

Hello,

First of all, thanks to everyone who've been helping others on the forum.

Now, here's my case:

I was a Teaching Assistant (was taxed 7.x% on my income) at Texas A&M Univ. until July, 2007 while studying. Upon my graduaion, I started working full time for a company in Texas on OPT. I just received my pay check and the statement says,

TX Withholding TAX: 16.25% ($xxx)
TX EE Social Sec TAX: 6.20% ($xxx)
TX EE Medicare TAX: 1.50% ($xx)

My question is, should I be taxed on all these and if so :( , the percentages I mentioned above while working on OPT?? Also, what forms should I be using while claiming for tax returns (I will be applying for my H1B only next year, April 2008)?

Once again, thank you guys for helping.

Regards,
Harsha

AtlantaTaxExpert · Sep 18, 2007, 06:52 AM

Harsha:

You SHOULD be paying federal income tax. Texas has NO state income tax.

You should NOT be paying Social Security or Medicare taxes UNLESS you entered the United States prior to 1 January 2002. This is because you retain your F-1 student visa exemption while on OPT.

The exemption is good for only five years, which would expire at the end of the fifth year in country.

hashashyin · Sep 18, 2007, 04:23 PM

Thanks ATE... But one more thing, shouldn't that withholding tax be less than 16%? Also, how can I get back the Medicare and Social Sec Tax that was cut from my pay check?

nightan · Sep 19, 2007, 01:54 PM

Originally Posted by hashashyin

Thnx ATE...But one more thing, shouldn't that withholding tax be less than 16%? Also, how can I get back the Medicare and Social Sec Tax that was cut from my pay check?

Hey Harsha,

You should get it touch with the Payroll Manager at your place of employment. Invariably you'll find out that they do not have your OPT documents meaning that you'll probably have to fax them a copy of your F-1 visa and also the latest I-20 which you received from your school after your OPT was approved.

Regards,

Narain

hashashyin · Sep 19, 2007, 04:04 PM

Thanks a lot Narain... I will get that done...

AtlantaTaxExpert · Sep 20, 2007, 10:23 AM

Nightan seems to have some experience in this matter, because my advice is identical. Almost all the time, the payroll department does not have the F-1 visa holder's documents, so they are acting in ignorance.

Correct this oversight and the payroll issues wll normally get resolved.

nightan · Sep 20, 2007, 11:30 AM

Originally Posted by AtlantaTaxExpert

Nightan seems to have some experience in this matter, because my advice is identical. Almost all the time, the payroll department does not have the F-1 visa holder's documents, so they are acting in ignorance.

Correct this oversight and the payroll issues wll normally get resolved.

Thank you, ATE! but one of Harsha's question is something that I would also like some information on. The fact that the Income tax withholding rate for him (currently 16.xx%, previously 7.xx%) changed. Is that usually because of the Net Taxable Income going up (which I'm assuming it did) Is there any publication which tells us that - for a Non Resident Alien (F-1 student) if your taxable income is $xxxx, then the withholding rate is xx.xx% or something like that. I looked through publication 519 and 515 from the IRS website and I'm still confused.

AtlantaTaxExpert · Sep 20, 2007, 06:09 PM

IRS Pub 15 dictates the amount withheld, based on the information provided on the W-4. And, yes, the higher the income, the higher the amount withheld.