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Tax filing requirements for *H-2A visa* agricultural workers & employers

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There are thousands of agricultural workers in the United States, who come every year during the agricultural season, on the H-2A visa. This visa program allows U.S. employers meeting specific regulatory requirements to bring foreign nationals to the United States to fill temporary agricultural jobs. The H-2A program being seasonal, complicates the tax filing, and makes the process of tax-filing unique for every H-2A employee. So let’s explore this further..

H-2A workers are exempt from FICA (Medicare & Social Security) taxes & Federal Tax Withholding

  • Under current tax laws, workers on H-2A visas are exempt from U.S. Social Security and Medicare taxes on compensation paid to them for services performed in connection with the H-2A visa. This holds true for both a resident or nonresident alien.
  • Also, wages paid to H-2A workers are not subject to mandatory federal withholding on their paychecks, unless they fall under Backup Withholding.

Backup Withholding

As an H-2A worker, do i still need to file Income Tax Returns in the US?

Yes. Although as discussed previously, an H-2A worker is not subject to backup withholding of FICA an federal income taxes, you still may have to pay income tax and file tax returns at year-end, as a non-resident or a resident, which depends on the following:

If you are a Non-resident

Please refer to our non-resident page, to understand who is a non-resident means for tax purposes. As a non-resident you will not filing federal income tax returns if all of the following apply:

  • Your total annual compensation is less than the personal exemption amount (this depends if you have dependents and if your filing status) and;
  • If you don’t have any other U.S. trade or business income other than the H2-A income, and
  • You have no other need to file a return (e.g., no need to satisfy tax liability on other U.S. source income)

However, if any one of these does not apply, you would have to file 1040NR or 1040NR-EZ. Please note that even if you might be exempt on part of your income under a tax treaty, you still may owe some income tax, and hence must file a federal US income tax return. Please note that as a non-resident you are also not subject to any self-employment tax, if paid as a contractor instead of an employee.

If you are a Resident

  • Under a substantial presence test, you might be considered a US Resident for tax filing purposes. If you are a resident of US as well as your home country, you might elect to be a non-resident or a resident, on a year-by-year basis.
  • However, if considered a US resident, you would have to file either Form 1040A, Form 1040EZ or Form 1040 depending on the filing requirement amounts under tax law. Further, as a contractor, you would be subject to self-employment tax, however, you could still be exempt under the terms of an applicable bilateral Social Security agreement to which the United States is a party (Totalization Agreement). Totalization Agreement, basically provides that you would still be covered under your home country’s Social Security. You would have to obtain a certificate of coverage from your home country to claim this exemption.
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