[tantrik03]

Hi
Thanks in advance for your great service!

My situation is as follows:

I converted from OPT (F1) to H1B in January 2006. My employer filed for a FICA refund for my OPT period. However, they forgot to activate FICA on my H1B.

We just realized it today and they're now in the process of activating it.

My question is - How do I / my company pay for the FICA taxes owed from Jan 2006 till date? Will I be in some sort of legal / immigration trouble?

Please let me know your thoughts asap! I'm really worried about this... :confused:

[AtlantaTaxExpert]

There will NOT be any immigration or tax trouble for you with the INS or IRS. If you told your employer about your visa change promptly, you fulfilled your obligation. The IRS will penalize your employer, NOT you.

Your employer may require that you make up for the payments he failed to collect. Since the final Form 941 is not due until 31 January 2007, your employer is within his legal rights to require such back payments. Had he waited until nexty month, AFTER the filing of the last Form 941 for 2006, then his legal grounds for collecting such back payment would not have been there. Technically, you could have refused to allow the collection of these back payments. Of course, he probably would have terminated your employment and his sponsorship of your H-1B visa, but it may have been worth losing the job rather than paying back up to $5,828 in Social Security taxes and who knows how much in Medicare taxes.

I had a phone call from a client in a similar situation, except her company wanted to collect back Social Security and Medicare taxes for FOUR years (2003 through 2006). When I calculated what the total payment would be, I recommended she quit her job and return to her home country. It seemed to me that job was not worth paying over $35,000 in back FICA taxes.

[tantrik03]

Thanks a lot for your advice! I appreciate it...

[AtlantaTaxExpert]

Glad to help!