Social Security and Medicare Taxes for Foreign Workers: FICA Rules

Social Security and Medicare taxes for foreign workers follow a simple default: if you work as an employee in the United States, you and your employer pay FICA, whatever your citizenship or visa. The exceptions are narrow and mostly cover nonresident students and exchange visitors, agricultural H-2A workers and people covered by a totalization agreement. Whether you are an H-1B engineer from Bengaluru, a TN accountant from Calgary or an F-1 student on OPT in Aurora, knowing which side of the line you are on can save thousands of dollars or prevent a wrongful refund claim.

Who pays Social Security and Medicare taxes for foreign workers?

IRS Publication 519 says FICA generally applies to wages for services performed as an employee in the United States, regardless of the citizenship or residence of the employee or the employer. That covers H-1B, L-1, O-1, TN and E workers, green card holders and H-4 or L-2 spouses with work authorization. Your employer must withhold even if you never expect to collect US benefits, and you cannot make voluntary payments if no tax is due.

Rates and limits for 2025 and 2026

SSA lists the 2025 base at $176,100, the 2026 base at $184,500 and a 2027 base of $192,300. If you work for more than one employer and your combined Social Security tax exceeds $10,918.20 for 2025, you claim the excess as a credit on your return; if one employer withheld more than that amount, ask the employer for a refund.

How to check and correct your FICA, step by step

1. Look at box 4 and box 6 of your W-2 and your pay stubs. Compare to your visa category.
2. Confirm your tax residency. An F-1 student who becomes a resident alien under the residency tests becomes subject to FICA, even if the visa stays the same.
3. Ask your employer or school payroll office to stop withholding if you are a nonresident exempt student or exchange visitor.
4. Request a refund from the employer first. If FICA was withheld in error, the employer reimburses you and claims a credit or refund.
5. If the employer will not refund, file Form 843 with the IRS. Attach your W-2, visa, I-94 or other arrival record, the I-20 (F-1/M-1) or DS-2019 (J-1), Form I-766 if on OPT, and an employer statement. If you cannot obtain one, use Form 8316 or your own statement explaining why.
6. Mail Form 843 with attachments to the IRS address in Publication 519. Additional Medicare Tax withheld in error is recovered on Form 8959 or Form 1040-X, not Form 843.
7. Keep the refund request on file. The IRS says tax withheld in error can take time to process.

Totalization agreements: Canada yes, India no

A totalization agreement coordinates two countries' social security systems so a worker pays into only one. Under most agreements, an employee temporarily sent by an employer to the other country stays covered by the home system and receives a certificate of coverage that exempts the worker and employer from the host country's tax.

• Canada: the agreement has been in force since August 1, 1984. A worker staying under CPP requests a certificate on Canadian Form CPT56 (for Quebec, form QUE/USA 101). A self-employed person who resides in the United States is covered by the US system; one who resides in Canada is covered by the Canadian system.
• India: SSA's list of agreements in force does not include India. An Indian national working in the United States for a US or Indian employer therefore pays US FICA from the first paycheck, and there is no US-India certificate of coverage to avoid it. If your Indian employer also requires Provident Fund contributions, tell your Indian Chartered Accountant, because the US does not credit them against FICA.

For a Canadian TN or secondment worker, see our totalization guide and remote work guide.

Self-employment tax

A nonresident alien is not subject to self-employment tax unless an international social security agreement covers them under the US system. A resident alien pays self-employment tax like a citizen, reported on Schedule SE. Self-employment income received after becoming a resident is subject to it even if earned earlier as a nonresident.

Documents you need

• W-2 and final pay stubs
• Passport, I-94 record, I-20 or DS-2019, EAD and I-766
• Employer's written statement on the refund request
• Canadian certificate of coverage, if any
• Letter of authorization for J-1 work

Deadlines and penalties

The employer's obligation to withhold is continuous, and mistakes are corrected by refund claim, not by the employee skipping payroll. Filing a Form 843 for FICA should be done promptly; the standard refund time limits apply, so do not wait for years. Employers who fail to withhold or deposit face penalties; our payroll compliance guide covers the Illinois side.

Country notes

Worked examples

Priya, H-1B, Bengaluru to Naperville. Salary $96,000. Employee FICA is $5,952 (6.2%) plus $1,392 (1.45%), or $7,344, and her employer pays the same. No agreement applies, so there is no exemption.

Arjun, F-1, OPT in Aurora. He is a nonresident in his second calendar year, earning $4,000 a month. FICA of $306 a month (7.65%) should not be withheld. If it was, his employer refunds it; if not, he files Form 843.

Karan, Calgary, seconded to a US plant for 18 months. His Canadian employer obtains a CPT56 certificate. He stays in CPP and neither he nor the US entity pays FICA on his wages.

Mistakes to avoid

• Assuming H-1B status exempts you from FICA.
• Claiming a student exemption after you become a resident alien.
• Filing Form 843 before asking the employer.
• Expecting India-US coverage coordination that does not exist.
• Forgetting that US work credits (up to four a year, ten years for retirement benefits) accrue only from covered earnings.

How we can help

Our Aurora, Illinois firm checks payroll for visa-based FICA errors, drafts employer statements and prepares Form 843 and Form 8316 claims. We handle the US side and coordinate with your Canadian CPA or Indian CA on certificates and home-country contributions. See our payroll and employer compliance service.

Frequently asked questions

General information only. It is not tax, legal, accounting or immigration advice for your situation, and rules change; confirm the current rules with the official source or a licensed professional in the relevant country.