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Returning Member

Switched from J1 to F1. Do I need to pay FICA? Am I resident Alien?

I am from India. I entered the US in July 2014 on J-1 Visa as a Visiting Scholar. I left the US in May 2015. I entered again in US in Aug 2015 on F-1 Visa for my PhD. The IRS website says: "Foreign students in F-1, J-1, M-1, Q-1 or Q-2 nonimmigrant status who have been in the United States more than 5 calendar years are RESIDENT ALIENS and are liable for social security/Medicare taxes". Now, I am not sure if my 5 years block counted from my entry date of F-1 or entry date of J-1.
 

My school counted my 5 calendar years from the date of entry on J-1 (2014), and it says I was RESIDENT ALIEN in 2019. Therefore, they withheld Social Security and Medicare Taxes (I was on wage position for some time of 2019 in my school). But, I also did two internships in 2019 in US and those employers used my date of entry of F-1 (2015) and called me NON-RESIDENT ALIEN, thus, didn't withheld Social Security and Medicare Taxes. Now, I would have 3 W-2s where one has FICA taxes and others don't.

 

Am I Resident alien in 2019 tax year? 

 

Do my internships employers need to pay FICA now for 2019?

 

Do I need to pay FICA taxes for what I earned in 2019 from these internships?

3 Replies
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Level 11
Level 11

Switched from J1 to F1. Do I need to pay FICA? Am I resident Alien?

@karanpreetsing ,  based on article 1, 21 and 22 of the USA-India tax treaty and the IRS rules regarding  exempt status of students for five calendar  years,  your exempt period started  in 2014 when you entered USA as a student ( J-1 student) and subsequent F-1 adjustment to F-1 still counted the J-1 period.  Thus  for US tax purposes  your exemption  ( from counting days present in the USA )  period terminated at the end of calendar year 2018.  2019 you would  be classified as  Resident Alien for tax purposes  and filing form 1040 ( and not  form 1040-NR ).

The tax treaty  requires  that USA  tax authority treat you just like a US student as far as the Social Security/ Medicare taxes go ( because the treaty does not apply to Social Security taxes  ) -- so if US students are exempt from Social Security taxes  for required training / residency etc., so are you.  So if your internship is NOT required by the school, then this income would be taxed like that of  an US student and FICA is applicable.

When you fill out your tax return TurboTax will compute the total FICA taxes  and you may end up in a "due" situation -- suggest  that you file before  April 15th. 2020  and therefore avoid any penalty and interest charges.  Also  make sure that any new employers are aware that you are now a Resident Alien for tax purposes.

 

Namaste Ji

Returning Member

Switched from J1 to F1. Do I need to pay FICA? Am I resident Alien?

Thank you very much for your reply. 

 

I understand your point. I will pay FICA through my tax return.

 

But are my previous employers also liable for any FICA taxes which were not deducted from my salary?

I am not sure, but do employers also match the FICA taxes paid by the employee? Is there any penalty on them too for not deducting my FICA taxes?

 

Thanks again! 

Highlighted
Level 11
Level 11

Switched from J1 to F1. Do I need to pay FICA? Am I resident Alien?

the FICA taxes are shared between the Employee and the employer ( each at 7.65%, currently )  --- your employer should be informed that you were  ( for 2019 ) a resident alien for tax purposes --- this will allow them to adjust their filings. And no there is no penalty for mistakes ( unintentional  ones ).

 

Namaste ji