Nonresident aliens on F-1, J-1, M-1 or Q-1 visas are not subject
to social security and Medicare taxes (FICA) if services are performed
to carry out the purpose for which they are admitted to the United
States [IRC sec. 3121(b)(19)]. This generally includes on-campus
work for which authorization is granted on Form I-94, Arrival
and Departure Record, or Form I-20, Certificate of Eligibility
for Nonimmigrant Student Status.
A nonresident alien admitted to the U.S. as a student is not
permitted to work off campus for a wage or to engage in business
unless given approval by the Immigration and Naturalization Service
(INS). This should be noted on the student's copy of Immigration
Form I-20, or Form I-688B, Employment Authorization Document.
Off-campus work due to severe economic necessity or for optional
practical training is considered by the IRS to qualify for the
exemption. The IRS does not consider other off-campus work performed
by a nonresident alien student to be performed to carry out the
purpose of a student visa.
Resident aliens, as well as nonresident aliens on F-2, J-2, M-2,
Q-2 or any other types of visas, are not exempt from FICA taxes
as nonresident aliens. However, IRC section 3121(b) (10) provides
an exemption from FICA for services performed in the employ of
a school, college, or university, if the service is performed
by a student who is enrolled and regularly attending classes at
that school, college or university. Therefore, international students
who do not qualify for the exemption for nonresident aliens might
be exempt under this provision. On the other hand (just to add
a bit more to the confusion), the law allows states to provide
Social Security coverage for services performed by students for
the public school the student is attending under agreements established
with the Social Security Administration. If a state has exercised
its option to provide for coverage of student services, section
3121(b) (10) of the Code provides that those services will not
qualify for the student FICA exception. If you wish to read the
official announcement from the IRS on who might qualify for this
student exemption, here it is in Adobe Acrobat format: Rev. Proc.
98-16.
How to Obtain a Refund
If FICA has been withheld from your wages by mistake (look in
box 4 of your W-2), you should first ask the employer who withheld
the tax for a refund. If the employer does not grant a refund,
a refund can be claimed from the IRS on Form 843. Follow the instructions
for claiming a refund on page 43 of Publication 519. Both Form
843 and Publication 519 can be printed from the U.S. Treasury's
Forms and Publications site. Note that you must attach a copy
of Form W-2, your visa, INS Form I-94, INS Form I-538 (if you
have one), and a statement saying "tax was withheld by mistake
and my employer denied me a refund." This form is sent in
its own envelope (separate from your tax return) to Internal Revenue
Service Center, Philadelphia, PA 19255.
Totalization Agreements
If you are in the United States only temporarily for work or
study and are not exempt from social security under one of the
above provisions, your U.S. social security contributions may
provide benefits in your home country under a "totalization
agreement" that the U.S. has negotiated with several other
countries. For more information on totalization agreements and
the countries participating go to the Social Security Administration's
Office of International Programs site.
