Student management

Social security and health insurance taxes: what is the responsibility of foreign students?

Seventy-four / Getty Images/iStockphoto

People from other countries who earn money in the United States as employees are generally required to pay Social Security and Medicare taxes, but there are exceptions for certain types of students.

See: 9 bills you should never put on automatic payment
Cash App Borrow: How to Borrow Money on Cash App

Figuring out who should pay these taxes means wading through the often esoteric language the IRS uses to categorize resident and nonresident alien status, as well as the various restrictions that apply. But as a general rule, students who meet certain nonresident alien criteria — and live temporarily in the United States for less than five years — are exempt from paying Social Security and Medicare taxes.

To qualify for the exemption, the services rendered must be authorized by United States Citizenship and Immigration Services (USCIS) for F-1, J-1, or M-1 nonimmigrant status. Exempt employment includes the following:

  • Student job on campus for up to 20 hours per week or 40 hours during summer vacation.
  • Off-campus student employment authorized by USCIS.
  • Employment of students in practical training on or off campus.

The exemption does not apply to the following:

  • Spouses and children in F-2, J-2 or M-2 status.
  • Employment not authorized by USCIS or not closely related to the purpose for which the visa was issued.
  • F-1, J-1, or M-1 students transitioning to another non-exempt immigration status or special protected status.
  • F-1, J1, or M-1 students who become resident aliens.

To learn more about the rules governing foreign-born students and employment, visit the USCIS website.

Dollar Tree: 5 High-Quality Items to Buy Now
More: 8 Costco frozen foods that give you the best bang for your buck

Foreign students in F-1, J-1, or M-1 nonimmigrant status who have resided in the United States for more than five calendar years generally become resident aliens for U.S. tax purposes and are therefore subject to the social security and health insurance taxes. But again, there are also exceptions to this rule.

For more information, visit the IRS page on Foreign Student Liability for Social Security and Medicare Taxes.

More from GOBankingRates

About the Author

Vance Cariaga is a London-based writer, editor and journalist who has previously held positions at Investor’s Business Daily, The Charlotte Business Journal and The Charlotte Observer. His work has also appeared in Charlotte Magazine, Street & Smith’s Sports Business Journal, and Business North Carolina magazine. He holds a BA in English from Appalachian State University and studied journalism at the University of South Carolina. His reporting has earned him awards from the North Carolina Press Association, Green Eyeshade Awards and AlterNet. In addition to journalism, he has worked in banking, accounting and restaurant management. A North Carolina native who also writes fiction, Vance’s short story “Saint Christopher” placed second in the 2019 Writer’s Digest short story competition. Two of her short stories appear in With One Eye on the Cows, an anthology published by Ad Hoc Fiction in 2019. Her first novel, Voodoo Hideaway, is published in 2021 by Atmosphere Press.