Changed status from F1 to H1b, employer didnt withheld FICA (Medicare and Social Security Taxes). How do I pay them?

[Phstnv]

Hi,

I entered USA in Aug 2016 on F1 visa and on October 1,2019 my status changed from F1 to H1b. However, my employer did not withheld FICA taxes (Medicare and Social Security Taxes). I am not sure what all forms I need to fill to pay my FICA taxes to IRS for the 3 months (October, November and December 2019).

The suggestions given to me are :
Fill SS-8 and send it 1 day before filing my taxes. And when I file my taxes submit Form 8819 (Uncollected Social Security and Medicare Tax on Wages).

Is this how I should be paying my FICA or is there another way?

Thanks!

[KurtL1]

You should not file a Form SS-8. This form is used to have your employer treat you as employee because he treated you as an independent contractor. 

You would file Form 8919 Uncollected Social Security and Medicare Tax on Wages to report the uncollected taxes.

There is another problem. Because you were on an F-1 Visa you were unable to count the days present in the United States for part of any five calendar years. You were not able to count your days present in 2019 until you received your H1B Visa. 

Because you did not receive the new visa until 10/01/19, you do not have enough days to meet the Substantial Presence Test to be classified as a Resident Alien for tax purposes. 

You will be considered a United States resident for tax purposes if you meet the substantial presence test for the calendar year. To meet this test, you must be physically present in the United States (U.S.) on at least:

1. 31 days during the current year, and
2. 183 days during the 3-year period that includes the current year and the 2 years immediately before that, counting:
   • All the days you were present in the current year, and
   • 1/3 of the days you were present in the first year before the current year, and
   • 1/6 of the days you were present in the second year before the current year.

You are unable to file a Form 1040 through TurboTax unless you are a citizen or a resident alien. You will need to file a Form 1040-NR for Nonresidents.

TurboTax does not support Form 1040-NR return. You will need to use Sprintax to file a Form 1040-NR return. If you have questions you can contact Sprintax Help for assistance.

[Phstnv]

Thanks for your reply.

The only reason for filling SS-8 is because Form 8919 asks for a reason code:

"Reason codes: For each firm listed below, enter in column (c) the applicable reason code for filing this form. If none of the reason codes apply to you, but you believe you should have been treated as an employee, enter reason code G, and file Form SS-8 on or before the date you file your tax return.

A : I filed Form SS-8 and received a determination letter stating that I am an employee of this firm.

C : I received other correspondence from the IRS that states I am an employee.

G : I filed Form SS-8 with the IRS and haven’t received a reply.

H : I received a Form W-2 and a Form 1099-MISC from this firm for 2019. The amount on Form 1099-MISC should have been included as wages on Form W-2. (Don’t file Form SS-8 if you select reason code H."

I believe I don't meet the criteria for substantial Presence Test and as you said would require filing 1040-NR. But my main question is about the form 8919 and how to pay the FICA taxes upfront to avoid penalty.

[KurtL1]

You would use Code H which does not require a Form SS-8. 

When you complete Form 1040-NR and file by 04/15, Form 8919 can be reported on the Form 1040-NR and the taxes paid with that return.

It is in the other tax section of the form:

[Phstnv]

Code H is for Form 1099-MISC right? Is it ok to use that? because Form 1099-MISC is about Miscellaneous incomes right?

[KarenJ2]

Yes, as @kalehnhardt2 indicated, that is the code you should use.

Yes, the Form 1099-MISC is an Internal Revenue Service (IRS) tax return document used to report miscellaneous payments and payments made to nonemployee individuals, such as independent contractors, during the calendar year.

If payment for services you provided is listed in box 7 of Form 1099-MISC, Miscellaneous Income, the payer is treating you as a self-employed worker, also referred to as an independent contractor.

[Phstnv]

Thank you @KarenJ2  and @KurtL1 . However I do not have a form 1099-MISC, should I fill up this as well?

[KarenJ2]

Code H is the closest to your situation.  I would still use Code H.

[Phstnv]

Thanks for all the information @KarenJ2  and @KurtL1 

[Rajshree7]

Hi I am in the same boat for for 2020 tax year. Form 8919 seems for unreported income on W-2 which doesn't seem accurate. Did you file this?

[ThomasM125]

Per IRS Publication 8919, you use form 8919 to report social security and Medicare taxes due on compensation if you were an employee but were treated as an independent contractor:

Is doesn't seem like @Phstmv was being treated as an independent contractor, but his payroll taxes were not being withheld. If you look at form 8919, there are not options to indicate that your employer did not withhold the proper amount of payroll taxes.

I would suggest you ask your employer if they can correct your W-2 to reflect the proper payroll tax and allow you to pay in your share if necessary. Also, it may be that you were not required to pay payroll taxes so that is why your employer didn't do so.

[ybharodia]

Hey, Were you able to figure out your situation? I am in the same boat as you and my employer didn't withhold the FICA taxes for 2020. I've asked if they can correct it and they said no. Any help would be appreciated. 

[LinaJ2020]

If your employer was not being co-operative, I will suggest you to contact the IRS.  

See links here:  

FICA withheld

Criminal act

@ybharodia

[Rajshree7]

No, didn't find any solution when employer didn't help.

[LinaJ2020]

See my post above.  Employers who do not comply with the employment tax laws may be subject to criminal and civil sanctions for willfully failing to pay employment taxes.

Call the IRS @ 800-829-1040

@Rajshree7