Election 6013 FICA Implications

[parvitstax]

Husband is H1B and Spouse is F1. They qualify for Election 6013 but since H1B pays FICA and F1 does not how does this affect 1040 filing? 

Is there a penalty for the spouse who did not pay FICA?

Is there a worksheet for calculating FICA due?

Does Election 6013 wave the FICA responsibilities of Permanent Residents / Citizens?

[TaxGuyBill]

If you read §6013(g)(1), you'll see that election only affects Chapter 1 and Chapter 24.

FICA is Chapter 23.

[parvitstax]

Sorry can you elaborate? I am having trouble understanding what the chapters mean in regards to the election.

[TaxGuyBill · Accepted solution]

The election does not affect FICA.   For purposes of FICA, the person is still a Nonresident Alien (until they meet the requirements to become a Resident Alien without the election).

[parvitstax]

Great. So that would mean they can file jointly and not get penalized for their lack of FICA contributions. Thanks!

[sjrcpa]

Chapters in the Internal Revenue Code.

[itonewbie]

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@TaxGuyBill wrote:
FICA is Chapter 23.

For purposes of FICA, the person is still a Nonresident Alien (until they meet the requirements to become a Resident Alien without the election).

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For the sake of clarity and for others who may come across this post in the future, FICA is under Chapter 21, not Chapter 23 (which is for FUTA).  FICA liability is also not determined by whether an individual is a US person based on §7701(b).  In fact, FICA is assessed on wages as defined in §3121(a), pursuant to §3101.

Except as provided for under §861(a)(3), compensation for labor or personal services performed in the US is US source income, which is subject to FICA.  In other words, FICA is assessable on foreign nationals who may be deemed an NRA under §7701(b), whether or not the compensation is paid by or on behalf of a US or foreign employer.

There are, however, various exceptions (this is tax law we're dealing with after all).  One of which is where totalization agreement's detached worker rule applies.  Another is the carve out in §3121(b)(19) for services performed by F, J, M, and Q visa holders so long as they remain an NRA and those services are performed to carry out the purposes of their respective visas.

[TaxGuyBill]

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@itonewbie wrote:

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For the sake of clarity and for others who may come across this post in the future, FICA is under Chapter 21, not Chapter 23 (which is for FUTA). 

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Thanks for the correction.  I even looked it up, but must have either looked at the wrong line or typed the wrong number.  😂

[parvitstax]

Does that mean F1 spouse needs to pay FICA taxes if using Election 6013? 

If yes, how is that calculated on the 1040? 

[itonewbie]

Generally no.  See my explanation above:

https://accountants.intuit.com/community/proseries-tax-discussions/discussion/re-election-6013-fica-...