My husband and I are H-1B workers in the US. We both are Chinese. My
husband has been working for more than 5 years and I have been working
for more than 2 years. Now we are going to leave the US and return
back to China.

Since H-1B is not exempt for Social Security/Medicare taxes, so our
employers deduct them from our income. But we are not going to retire
in the US. And also our country (China) doesn?t have an agreement with
the U.S. regarding sharing Social Security credits. My question is

1) Can we get the refund of the Social Security/Medical Tax since we are leaving?
2) If yes, where and how?
3) If no, how can we take the benefit in the future when we retire in China?

I appreciate for any answer.
Please answer as soon as possible, because we will leave very soon.

Lucy Qian

---

Request for Question Clarification by cynthia-ga on 08 Dec 2005 02:31 PST

You or your friend may be confusing this with the China Treaty that
makes one exempt from INCOME tax, not Social Security Tax.

You've asked for a lot of information, and since I didn't find ALL you
asked for, I'm giving you what I did find, for free. If this qualifies
as an answer, please update and I'll be happy to post in the answer
box!

In short, I could not find an exemption for you, unless you have been
paying into your country's Social Security:

Tax Topic: Earnings
http://www.hrblock.com/taxes/fast_facts/tax_faq_dtl.jsp?source=&subcategory=283&category=1&subcategory_name=Earnings&cid=2040
(Note, I could not find this at the SS site, so this might not be
accurate) ..."I'm working on H1B (work permit) Visa and paying Social
Security tax along with other taxes. Since my status is not permanent
in the United States, I might go back to my country at any time. When
I do, is my Social Security tax refundable? If yes, then how? If not,
then what benefit do I get from paying this tax?

Your wages are subject to Social Security tax unless you are paying
into the Social Security system of your home country, with which the
United States has a tax treaty. The payment is simply according to
U.S. tax law..."


Foreign National Tax Guide - Must You Pay Social Security and Medicare Tax?
http://www.thetaxguy.com/sstax.htm

Foreign National Tax Guide - Your Residency Status
http://www.thetaxguy.com/residency.htm

Interesting FAQ's, some are relevant to you.
http://www.thetaxguy.com/faq.htm


Payments to Foreign Nationals: Answers to Frequently Asked Social
Security Questions
http://library.findlaw.com/1999/Jun/1/127219.html
..."1. Do I have to withhold social security on compensation paid to a
foreign national who will not be working in the United States long
enough to vest for benefits?

Yes. Foreign nationals employed in the United States are subject to
social security taxes unless an exemption applies..."


Aliens Employed in the U.S. ? Social Security Taxes
http://www.irs.gov/businesses/small/international/article/0,,id=131635,00.html
..."H-visas. Certain nonimmigrants in H-2 and H-2A status are exempt
from Social Security/Medicare taxes as follows:

    * An H-2 nonimmigrant who is a resident of the Philippines and who
performs services in Guam;
    * An H-2A nonimmigrant admitted into the United States temporarily
to perform agricultural labor.

The U.S. has signed Totalization Agreements with certain countries,
which may affect an alien?s liability for Social Security or Medicare
taxes. The complete texts of the Totalization Agreements may be found
on the Social Security Administration's website..."

107. Totalization Agreements
http://www.ssa.gov/OP_Home/handbook/handbook.01/handbook-0107.html
..."What are "totalization agreements"?
The Social Security Act allows the President to enter into
international agreements to coordinate the U.S. social security
programs with the social security programs of other countries. These
agreements are known as "totalization agreements."

With what countries does the U.S. have totalization agreements?
The United States currently has Social Security agreements in effect
with 21 countries - Australia (2002), Austria (1991), Belgium (1984),
Canada (1984), Chile (2001), Germany (1979), Finland (1992), France
(1988), Greece (1994), Ireland (1993), Italy (1978), Japan (2005),
Luxembourg (1993), the Netherlands (1990), Norway (1984), Portugal
(1989), South Korea (2001), Spain (1988), Sweden (1987), Switzerland
(1980), and the United Kingdom (1985).

What are the purposes of totalization agreements?
Totalization agreements have three main purposes:
   1. To eliminate dual social security coverage and taxation. This
situation occurs when a person from one country works in the other
country and is required to pay social security taxes to both countries
for the same work;
   2. To avoid situations in which workers lose benefit rights because
they have divided their careers between two countries. Under an
agreement, such workers may qualify for partial U.S. or foreign
benefits based on combined work credits from both countries.
   3. To increase benefit portability by guaranteeing that neither
country will impose restrictions on benefit payments based solely on
residence or presence in the other country.

U.S. International Social Security Agreements
http://www.socialsecurity.gov/international/agreements_overview.html
Country	       Entry into Force
Italy	       November 1, 1978
Germany	       December 1, 1979
Switzerland    November 1, 1980
Belgium	       July 1, 1984
Norway	       July 1, 1984
Canada	       August 1, 1984
United Kingdom January 1, 1985
Sweden	       January 1, 1987
Spain	       April 1, 1988
France	       July 1, 1988
Portugal       August 1, 1989
Netherlands    November 1, 1990
Austria	       November 1, 1991
Finland	       November 1, 1992
Ireland	       September 1, 1993
Luxembourg     November 1, 1993
Greece	       September 1, 1994
South Korea    April 1, 2001
Chile	       December 1, 2001
Australia      October 1, 2002
Japan	       October 1, 2005


H1-B and refund of Social Security tax
http://www.immigrationportal.com/showthread.php?t=132393


And, since I found it:
http://www.ssa.gov/policy/docs/progdesc/ssptw/2004-2005/asia/china.pdf


~~Cynthia


Search terms:
H-1b visa "social security tax" refund

---

Clarification of Question by yhqian-ga on 08 Dec 2005 08:51 PST

Hi Cynthia,

From the links you provided, I found the answer to my question.

In my case, my conclusion is  we can't get any refund right now
and in the future when we retire in China we still can not get any 
benifit from what we paid for social security tax. 

If we return to the US in the future and continue  to work to meet the
10 years and then retire here, we can get the benefit.

Cynthia, am I right?



The following the the two links:

http://library.findlaw.com/1999/Jun/1/127219.html
11. Can a foreign national employee obtain a refund of the taxes when
he or she leaves the country if the individual will not work in the US
long enough for benefits to vest?

No. Although occasionally the Social Security Administration
reimburses these taxes to someone who is departing and will not vest
in the system, its a fluke. There is no basis for refunding the tax
unless the employee was exempt from social security taxes and taxes
were withheld incorrectly. However, if the individual is from a
country with which the US has a social security agreement, he or she
may be able to use work time in that country to obtain a partial US
benefit under the agreement totalization formula.



http://www.immigrationportal.com/showthread.php?t=132393
H1-B and refund of Social Security tax 

--------------------------------------------------------------------------------

Hi! 

My husband (from India) and I (from Thailand) are here on H1B visa and
we are shortly immigrating to Canada. We were told we could ask for a
refund of our social security as we have been here for less than 6
years.

What is the procedure of getting the social security taxes refunded?

I called the SSA and the person I spoke to did not seem to know anything about it.

I would appreciate any help with regard to this issue.

Thanks.

-----------Z


SS tax cannot be refunded, you can only claim SS benefits if you
qualify. One basic qualification is reaching retirement age AND having
contributed to SS taxes for 10 years.



Yuhong Qian

---

Request for Question Clarification by cynthia-ga on 08 Dec 2005 13:33 PST

Yes, that looks right to me, and it makes sense. I'm glad you found
your answer! Would you like me to post the correct links with the text
in the answer box so I can receive compansation?

---

Clarification of Question by yhqian-ga on 08 Dec 2005 14:44 PST

Hi Cynthia,

Please go ahead and post the correct links with the text
in the answer box .

Thank you!

Lucy Qian

Yuhong Qian,

Thank you for accepting my research as your answer. I'm glad I was
able to help. In your case, SS tax cannot be refunded because
..."there is no basis for refunding the tax unless the employee was
exempt from social security taxes and taxes were withheld incorrectly.
However, if the individual is from a country with which the US has a
social security agreement, he or she may be able to use work time in
that country to obtain a partial US benefit under the agreement
totalization formula..."

Note above, China does not have such an agreement with the US, so now,
and in the future when we retire in China we still can not get any
benefit from what we paid for social security tax. .

REFERENCE:
http://library.findlaw.com/1999/Jun/1/127219.html

Also:

H1-B and refund of Social Security tax 
http://www.immigrationportal.com/showthread.php?t=132393
..."SS tax cannot be refunded, you can only claim SS benefits if you
qualify. One basic qualification is reaching retirement age AND having
contributed to SS taxes for 10 years..."

As you noted, this is correct:  ..."If we return to the US in the
future and continue to work to meet the 10 years and then retire here,
we can get the benefit..."


~~Cynthia


Search terms:
H-1b visa "social security tax" refund

Before I posted my question I did a lot research on the internet and
read a lot ducuments from SSA, IRS and other websites, those documents
helped me understand a lot background knowledge and rules, but I could
not find an answer
to the question which is exactly my case. So went to Google Answers, where
from one of the links that Cynthia provided to me I found exactly what I want.

http://www.ssa.gov/

I'm pretty sure you need to work at least 10 years to have enough credits.

The people of America thank you for your contribution to our system. 
Have fun back in China.

One of my friend told me that he had done some research on this issue
early in this year, he remember he found a document which says these
people can get the refund of Social Security Tax, but he lost that
document and could not find any more.

This is a serious issue, because there are lot of Chinese people and
indian people like us who divide their career in their home country
and the US, when
they get back to their home country they lost all the benefit of the
Social Security tax.


Yuhong Qian

One of my friend told me that he had done some research on this issue
early in this year, he remember he found a document which says these
people can get the refund of Social Security Tax, but he lost that
document and could not find any more.

This is a serious issue, because there are lot of Chinese people and
indian people like us who divide their career in their home country
and the US, when
they get back to their home country they lost all the benefit of the
Social Security tax.


Yuhong Lucy Qian

These taxes are not refundaable, emphasis on the word "tax".

Hi Cynthia,

From the links you provided, I found the answer to my question.

In my case, my conclusion is  we can't get any refund right now
and in the future when we retire in China we still can not get any 
benifit from what we paid for social security tax. 

If we return to the US in the future and continue  to work to meet the
10 years and then retire here, we can get the benefit.

Cynthia, am I right?



The following the the two links:

http://library.findlaw.com/1999/Jun/1/127219.html
11. Can a foreign national employee obtain a refund of the taxes when
he or she leaves the country if the individual will not work in the US
long enough for benefits to vest?

No. Although occasionally the Social Security Administration
reimburses these taxes to someone who is departing and will not vest
in the system, its a fluke. There is no basis for refunding the tax
unless the employee was exempt from social security taxes and taxes
were withheld incorrectly. However, if the individual is from a
country with which the US has a social security agreement, he or she
may be able to use work time in that country to obtain a partial US
benefit under the agreement totalization formula.



http://www.immigrationportal.com/showthread.php?t=132393
H1-B and refund of Social Security tax 

--------------------------------------------------------------------------------

Hi! 

My husband (from India) and I (from Thailand) are here on H1B visa and
we are shortly immigrating to Canada. We were told we could ask for a
refund of our social security as we have been here for less than 6
years.

What is the procedure of getting the social security taxes refunded?

I called the SSA and the person I spoke to did not seem to know anything about it.

I would appreciate any help with regard to this issue.

Thanks.

-----------Z


SS tax cannot be refunded, you can only claim SS benefits if you
qualify. One basic qualification is reaching retirement age AND having
contributed to SS taxes for 10 years.

There might be different circumstances in the life.
Keep in mind that SS provide disability benefits for less then 40
credits (6 to 20), and also some family members are eligible.
If you die, certain members of your family may be eligible for
benefits even you worked less then 10 years