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    kikiben's Avatar
    kikiben Posts: 2, Reputation: 1
    New Member

    Mar 15, 2008, 10:37 AM
    F-1(OPT) and H-1B Visa tax exemptions
    I have looked at the similar questions and answers to mine, but I'm writing to clarify and confirm my own situation. I apologize if I am being repetitive.

    I am a Canadian citizen. I came to the U.S. in August, 2005 on an F-1 Visa. I completed my M.A. at an American university in May, 2007. I started working on the F-1 (OPT) visa in August 2007 at a community college. I am currently employed as a full-time faculty instructor. My question is, what taxes am I exempt from? Currently, my employer has been taxing me for FICM, FICA, and FWHM. Which of these taxes should they NOT be taxing me for? After doing some research on my own, I know that they should not be taxing me for FICA, but I wonder about the others? What is the code for medicare taxes, as I think I shouldn't be paying that tax either?

    I also wonder about the "five-year exemption". My employer is currently applying for the
    H-1B visa, and it should take effect when my OPT expires in July, 2008. When I change from OPT status to H-1B, what taxes will I be exempt from? To rephrase my question, under the five-year exemption, can I still continue to be exempt from the same taxes that I would be under the F-1 (OPT) visa?

    One more question. Since my employer has been taxing me for FICA and possibly medicare, how will this affect my income tax returns for this year? It is obvious that my employer owes me a lot of money. I have not filed for the income tax returns yet, so I want to get this problem resolved ASAP. Thanks for the help.
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
    Senior Tax Expert

    May 1, 2008, 02:27 PM
    You are exempt from Social sceurity and Medicare taxes while on the F-1 visa.

    Not sure on the others; defining the acronyms would help!

    Your F-1 is good through 2009 under the five-year rule if you remain on the F-1 visa, but the day the H-1B becaomes effective is the day you become liable for Social Security and Medicare taxes.

    Yes, you CAN get the Social Security and Medicare taxes back that was improperly withheld during your OPT period.

    First, you must request that the employer refund these taxes. When they refused (which they will because the tax year has been closed), get the refusal in writing, preferably on company letterhead.

    You then submit Form 843 with the refusal letter and other support documents as specified on Page 49 of IRS Pub 519.

    It will take about two months, but, eventually, you will get your money IF the IRS agrees with the request. Make note of that: the refund is NOT GUARANTEED. The IRS can and has refused to grant the refund, often for non-valid reasons. The refusal CAN be appealed, often successfully, but the costs make such an appeal problematic.

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