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Do I need to pay the FICA Tax?
Hi,Expert:
I am a J-1 holder from China and doing Postdoctoral researcher associate in a University in USA now. I arrived USA in Oct. 2004. I found in my first month payroll of 2006,there is FICA tax has been withheld. Normally there are two years for all J-1 visa holders have Taxes exemption. So I want to know whether I can exempt my FICA Tax or not? Thanks! Best regards, Spectra |
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Spectra:
Contact your payroll first and work with someone who is knowledgeable about the tax exemptions. Have him/her review IRS Pub 519 and 501. Once you have corrected the problem with the university withholding the taxes, your next step is to file Form 843 for both 2004 and 2005 to get the withheld FICA taxes refunded to you. See page 46, IRS Pub 519 for the forms needed. You will need a letter from the university stating they refuse to refund these withheld taxes for 2004 and 2005 (trust me, they will refuse). |
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Spectra:
If you are exempt from all taxes as I suspect you are, then you should file Form 843 and ask for a refund of all withheld taxes (income, Social Security and Medicare). Do not file Form 1040NR-EZ, as that would be tacit admission that you are liable for the income taxes. |
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Hello Expert,
I am a J1 visa holder (postdoc scholar) since 2004. Starting 2009, my university where I am working has been starting deduct FICA/OASDI + Medicare tax from my paycheck. I ask them (personnel department) and they said I am only exempt for 5 years. Is it correct, expert? Thanks |
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That is correct.
In fact, if you were exempt from income taxes as a J-1 scholar for 2004 through 2008 as specified by the U.S.-China Tax Treaty, they should have started withholding the FICA (Social Security and Medicare) taxes starting on 1 January 2006, because exemption from FICA taxes is NOT controlled by treaty, but rather as a matter of U.S. tax law, which says J-1 visaholders whe are NOT students should start paying FICA taxes at the beginnign of the third year in country. |
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