Claiming your social security and medicare tax refund for international students

International students who file as non-resident alien taxpayers are typically exempt from paying FICA taxes. But if you did not know about this before earning your paycheck, then you might have had these taxes withdrawn anyway. Luckily, you have up to three years to claim your social security and medicare tax refund for international students.

This article will help you determine if you were eligible and explain how to claim your FICA refund.

What is FICA?

The term FICA and payroll taxes are used interchangeably. They refer to two taxes taken out of most employees’ paycheck in the U.S.: social security and medicare. These taxes fund the country’s largest two entitlement programs.

The combined FICA tax rate paid by employees is 7.65%. This is comprised of 6.20% for Social Security taxes and 1.45% for Medicare.

This can result in a meaningful amount of money. For instance, someone making an annual salary of $125,000 will pay over $9,500 in payroll taxes. Even a summer intern making $15,000 will end up contributing $1,150 in FICA taxes.

The bottom line: FICA taxes add up to what we in the accounting industry call “real” money 😉

Who is exempt from payroll taxes?

The good news for some international students? You’re likely exempt from FICA taxes!

There are two key requirements to being exempt:

  1. You must meet the qualifications to file as a non-resident alien taxpayer. You can read more about the qualifications here. Most international students, unless on a green card, usually file as non-resident aliens.
  2. You must be working on an exempt visa type. The exempt visa types are: F,” “J,” “M,” or “Q”.

In our experience, most international students meet both requirements to be exempt from FICA.

How do international students claim their FICA tax refund?

If your employer withheld payroll taxes anyway, either because you filled out Form W-4 incorrectly or your employer was simply misinformed, it’s likely not too late to reclaim your FICA tax refund.

First, check how much social security and medicare payroll taxes were withheld by looking at your Form W-2. This form should have been sent to you by your employer shortly after the end of the year (in January or February). Box 4 lists the amount of “social security tax withheld” and Box 6 lists the amount of “medicare tax withheld”. Add those up to see how much you might be able to recover by claiming your FICA tax refund.

Once you’ve confirmed that you had FICA taxes incorrectly withheld, here is what you will need to do:

  1. Send a letter to your employer. Your employer will tell you that they already passed the money onto the IRS. But it’s a required step to get in writing.
  2. Fill out and compile the following forms: Form 843, Form 8316, Form W-2, Form I-94, your visa documentation, and the employer letter.
  3. Mail in the combined packet to the IRS.

Visor makes claiming your FICA tax refund simple

If the above sounds like a big hassle (and it probably does), you might want to let Visor help you out. It’s never fun dealing with the IRS alone, especially given that they’re not fans of refunding payroll taxes. We can help streamline the process of claiming your social security and medicare tax refund.

What are the benefits of working with Visor?

  1. We’ll provide a templated letter to send to your employer and make sure the letter they return to you will qualify.
  2. We’ll fill out Form 843 and Form 8316 for you then put together the rest of your documents into a nice refund request packet.
  3. We’ll send it into the IRS and help make sure they refund your FICA taxes.

We charge just $149 to reclaim each year’s FICA taxes. If you’re an existing client and we filed that year’s tax return, we only charge a reduced rate of $99.

Next Steps

If you have FICA taxes to reclaim, don’t delay any longer. Get the process started by contacting us at Visor. We’re a year-round tax service, so we’re ready to help you out today.

Visor is one of the leading tax providers for non-US citizens, particularly for international graduate students and other young professionals. Sign up and take comfort knowing all your tax needs are in expert hands.

 

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27 Comments

  1. Hello,
    Just wanted to know if some similar refund of social security and Medicare is available for H1 visa holders who returned to their countries for good.
    If you could point to relevant part of SSA documents that would be great!
    Thanks

    1. Hi Ratnadeep – Great question! Unfortunately, we are only able to go back three years when amending tax returns. That means that you can still claim a refund for 2015 FICA withholdings, but it would be too late for 2014. Reach out to a Visor tax advisor though so we can review your eligibility and help reclaim your taxes if eligible!

    1. Hi! Unfortunately there’s no set timeframe but can take a while, certainly more than 2 months. Did Visor help you file for the FICA refund? If so, log into your account and send a message to your tax advisor and we’ll see if we can help. Thanks!

  2. Hi, I am a f-1 student and I have a son,he is a US citizen,obviously he has a social security number and I don’t! but I pay taxes anyway,so how do I do to claim for his tax refund since I cannot claim for mine??

    1. Hi Ilda – I might not understand your question correctly, but your son likely won’t pay any taxes himself assuming he’s too young to be earning any income. As a non-US citizen on a F-1 visa, you’ll likely be filing as a ‘non-resident’ using Form 1040NR. Non-residents, same as residents, get to claim children on their tax return as a dependent, which might lead to tax savings like the child tax credit. If you have specific questions, feel free to create an account for free at http://www.visor.com and send us a question through the online platform. We have lots of experience filing tax returns for international students so more than happy to work with you this upcoming tax season to make sure you get the most tax savings!

  3. I was on F1 until september 30 2018 and my status got changed to H1B on october 1 2018. My employer deducted FICA taxes on wages received from October 1st 2018 to December 31st 2018. However I do not qualify for substantial presence test, since I was in H1b only for 3 months in 2018, can I reclaim my FICA taxes.?

    1. After you switch to H1b visa, you are liable to pay FICA tax for those 3 months, therefore you would not be able to claim refund for this tax. If your employer withheld FICA while you were on F1 visa (as long as you were on F1 for less than 5 years), you would potentially be able to reclaim that tax.

  4. I was on F1 until September 30 2018 and my status got changed to H1B on October 1 2018. My employer deducted FICA taxes on wages received from October 1st 2018 to December 31st 2018. However I do not qualify for substantial presence test, since I was in H1B only for 3 months in 2018, can I reclaim my FICA taxes.?

    1. Hi Santosh, your employer was correct to withhold FICA taxes when you became a resident for tax purposes (aka on the date your visa changed to H1b). Even though you did not pass the substantial presence test for income tax purposes, Social Security and Medicare tax rules do not follow the same rules.

  5. I’m a F-1 student, and working as STEM OPT now. I studied in USA since 2011, can I still claim the social security and Medicare wage back? Since they considered me as a resident allian.

    1. Hi Jin – If you were an F1 student starting in 2011, you would be considered a tax nonresident for 5 years (until 2015). While you are a tax nonresident you should not have paid Social Security and Medicare tax (collectively known as FICA) during those years. If you did, you have 3 years from the date of the filed tax return to request a refund of FICA. After 5 years on F1 visa, you are considered to be a resident alien and required to pay FICA and not eligible to receive a refund even though prior years may have had FICA applied in error.

  6. I have been in US since 2012, therefore considered a resident alien. My wife has been in US since 2015, therefore considered a non-resident alien. However, we file tax jointly. For tax purposes my wife is considered a resident alien. Is my wife still eligible for the FICA tax exemption in this situation? Thanks!

    1. You and your spouse are treated as residents for federal income tax purposes if you file a joint return. Social Security and Medicare tax withholding may still be treated as for a nonresident alien depending on the type of Visa and whether you have elected to both be treated as residents for tax purposes. Here is an IRS summary of Visa types, whether a spouse would be exempt from FICA withholding and limitations of the exemption: IRS – aliens employed in the U.S.

  7. Hi!

    I have two questions: I was an F1 student in 2010 and in 2013 I took a break and left the country. Came back in 2014, graduated in 2015 and started working on my OPT at the end of 2015 until end of 2016. Was I considered to be on F1 for 5 years or less and therefore eligible (since I took a break)? Is it too late to file a refund?

    1. Hi there, 5 year rule for students in the U.S. applies to a full or partial year that you are in the U.S. on an F1 visa and the 5 years do not have to be consecutive but instead are counted cumulatively. Generally, you have 3 years to file for FICA refund from the date your tax return was filed.

    1. You generally have 3 years from the year FICA was withheld in error to request a refund. You are considered to be a tax nonresident during for 5 years while of F1 student visa and therefore during those years eligible for the refund of FICA tax withheld as long as you are within the 3 year time frame of requesting the refund. Considering your 5 year rule is applicable for years of 2011-2015, the 3 years from 2015 have already lapsed. After 5 years on F1 visa, you are considered to be a resident for tax purposes and required to pay FICA tax.

  8. Hi,
    I’m a F1 student currently working full time in my field of study under opt & stem opt work authorization since Sep 2016. My employer has deducted Both Medicare and social security taxes since I started working. Could I file for FICA tax refund for all past three years with you guys?

    Thanks

    1. Thanks for reaching out, generally you have 3 years to file for a refund of FICA taxes withheld in error. When you sign up for Visor, our team can take a closer look at your tax situation and help file the appropriate documents for a requested refund.

    1. Not illegal to ignore the process and depending on the amount, it may not be worth asking for a refund as the process can take up several months depending on processing time by employer or IRS.

    1. Thanks for the question, Visor can help look into your situation and file for FICA refund. Please sign up at Visor.com and send up a message with the details of your tax situation and upload W2 in question. We would be happy to help!

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