H1B to F1 transition and FICA TAX

[gopala007]

I was on f1 until October 2022 after that I got transitioned to  H1B from Oct\2022 to Nov\2023 and has paid FICA tax for the duration of H1B status.

In Nov 2023 again I transitioned back to F1 for my higher studies . Do I need to pay FICA or not since I am changing from H1B to F1 ?

My total duration on first F1 was for 2 years.

Please help. Also Can Turbo Tax help here to file tax of this mixed status.

Thanks

[Anonymous_]

@pk?

[pk]

@gopala007 ,    Namaste ji

(a) Generally with  the first entry   as F-1, one is allowed a five calendar year  reprieve  from having to count days present ( "exempt"  status ) towards  Substantial Presence Test.    So if you changed your F-1 status and then came back to F-1, you still have  ONLY the original five calendar years and/or the unused portion thereof.

(b) Thus I would , absent any other contravening facts/ circumstances, that  if  you entered the country in 2020, your max availability of  exempt status is  till m12/31/2024.   So if you became ineligible for exempt status  for the period 10/01/2022 through 11/01/2023,  then you have only 01/01/2024 through 12/31/2024 as the remainder exempt period.  Note that this  depends  on the exact circumstances and facts in your case.

(c) The FICA tax has really nothing to do with "exempt " status.   It depends on your work status ( training , school education  status) -- whether you are a trainee or an actual employee.  So if you are allowed to work /earn on the school premises or as a trainee / part of your education/ research  etc. you are temporarily present and therefore immune  from FICA requirements.

Please tell me more about --- when did you arrive in the USA, was this your first entry for any reason, which country are you from, why did you change to H1-B   ( not OPT? ), are you married and if so to whom -- US person or an NRA, etc. etc.

I will circle back once I hear from you 

pk

[nik8singh]

Hey @pk 

My immigration history:

Entered US 12/30/2013 on F1
Changed to H1B on 11/18/2017
Current H1B Expiry date: 1/27/2024
Changed to F1 on 12/11/2023

Since date does not matter only year matters, I have been on F1 = 2013, 2014, 2015, 2016, 2017, 2023 = 6 years
Does that mean FICA taxes should be deducted from my paychecks this year?
I see there is a statement on IRS site,

"You will not be an exempt individual as a student if you have been exempt as a teacher, trainee, student, Exchange Visitor, or Cultural Exchange Visitor on an "F, " "J, " "M, " or "Q " visa for any part of more than 5 calendar years, unless you establish to the satisfaction of the IRS that you do not intend to reside permanently in the United States, and you have substantially complied with the requirements of your nonimmigrant status"

I haven't filled PERM or i140. Does that mean I satisfy that I do not intend to reside permanently and don't have to pay FICA Taxes? 

[pk]

@nik8singh ,  you are talking about two different things  -- one controlled by the IRS and the other by SSA ( Social Security  Admin ).

For IRS, , specifically  for F-1 admissions, the first time  on F-1 gets a five Calendar years  of  "Exemption" from counting days present towards satisfying  SPT ( Substantial Presence  Test ).  So in your specific case since you entered  US on F-1 in 2013  ( I am surprised that  you entered on 12/30/2013 and not on Jan 1st  2014 ),  However , this would have meant that  ( and barring any other  influencing facts / circumstances )  you were  on "exempt" status  till 12/31/2017.

Now , because  your status was  adjusted to H-1B on 12/11 2017,   your  exempt status terminated on that date and you started counting  days present  towards SPT.  Therefore during 2018 would have met the SPT and be a Resident for tax purposes  ---taxed on world income.

at the end of 2023 ( 12/11/2023 ) your status was again adjusted to F-1 -- but now you are NO LONGER an EXEMPT status individual, so you are taxed on your world income , even as a student on F-1.

The FICA  exception is  not connected to  immigration status --- if you are student / trainee etc. and working at the University/school and/connected entities, then you are immune from FICA.

Does that make sense ?    Do you need more help on this ?

pk