The Federal Insurance Contributions Act (FICA) imposes
on employers and on employees. These taxes,
FICA tax or social security tax, finance old
insurance and medicare insurance provided under the
In general, Medicare taxes
are assessed and processed in essentially the same
manner as FICA taxes.
The calculation of the tax is based on
of wages paid to an employee for employment. The law
for several exemptions by excluding either certain
as employment or types of compensation as wages.
As a general rule, FICA tax is
to salary or wage payments made by U.S. employers to
alien employees, unless one of the
Working at the Institution
Internal Revenue Code (IRC) Section
generally provides that a student who works for the
at which s/he is enrolled and regularly attends
exempt from the FICA tax. The exemption applies
US citizens and nonresident alien students.
Additional information re exemption under Section 3121( b)(10) is available in Internal Revenue Bulletin 2005-2, which focuses on student exemption FICA rules. Section 7 deals with undergraduate and graduate student concerns.
F, J, M, and Q
IRC Section 3121(b)(19) states that
employment for FICA tax purposes will not include
which is performed by a nonresident alien person for
s/he is temporarily present in the US as a
various subparagraphs of the Immigration and
To qualify for the section
the individual must be: (i) a nonresident alien;
(ii) an F-1,
J-1, M-1, or Q-1 visaholder; (iii) performing
carry out the purpose of the primary ("-1")
The current position of the IRS is
that an individual
will not qualify for the section 3121(b)(19)
he is a resident alien for tax purposes under either
card test or the substantial presence test.
Any secondary visaholders (F-2, J-2,
e.g. spouse and dependent children of the primary
are not eligible for the section 3121(b)(19)
the purpose of their visit to the US is to
accompany the primary
(-1) visaholder, not to work.
Publication 519, issued 3/07/13, pp 42-43 provides this statement relating to Students and Exchange Visitors:
"Generally, services performed by
you as a nonresident alien temporarily in the United States as a nonimmigrant
under subparagraph (F), (J), (M), or (Q) of section 101(a)(15) of the
Immigration and Nationality Act are not covered under the social security program
if the services are performed to carry out the purpose for which you were
admitted to the United States. This means that there will be no
withholding of social security or Medicare taxes from the pay you receive for
these services. These types of services are very limited, and generally
include only on-campus work, practical training, and economic hardship
Tax Treaties to FICA
Unless a treaty carries specific
a FICA tax exemption, it likely will be difficult to
that FICA tax is exempt under an income tax treaty.