Scholars who have been in the U.S. less than 2 years (and are therefore nonresidents for tax purposes) are not subject to any FICA (social security) and Medicare withholdings. The mechanism for the exemptions are found under Internal Revenue Code 3121 (b)(19) and is available to persons in F-1, J-1, M-1 and Q immigration status. It is a blanket exemption with the only qualification being that the person be a nonresident for tax purposes and that the work is authorized (CPT, OPT, AT). IRS Publication 519 is a good resource.
It is best to make a determination of the scholar's tax status prior to withholding, to avoid taxes withheld in error. Please note that an extension of a scholar's program past two years may change their tax status.
For other questions about taxes, tax treaties, withholdings, etc., ISSS strongly encourages you to contact the Payroll office or view their website.
Do scholars have to file taxes?
