Sponsors
The bill brings F-1 OPT workers into Social Security and standard payroll-tax rules—strengthening benefit coverage and tax compliance but lowering take-home pay, raising employer costs, and risking reduced OPT participation.
F-1 students working on OPT will earn Social Security credits and be covered by Social Security benefits for work performed after enactment, improving their long-term retirement and disability protection.
Employers hiring OPT participants will report wages and remit FICA/Medicare taxes, creating clearer tax treatment and more consistent payroll-tax compliance.
Increased payroll tax receipts from OPT workers could modestly boost Social Security and Medicare funding over time.
F-1 students on OPT will have immediate reductions in take-home pay because of required FICA/Medicare withholding.
Employers will face higher labor costs from employer FICA/Medicare contributions for OPT hires, which could reduce demand for hiring OPT participants—especially at small businesses.
The change will add administrative burden for IRS, SSA, and employers to update payroll and reporting systems beginning the first calendar month after enactment.
Based on analysis of 2 sections of legislative text.
Makes wages earned by F-1 nonimmigrants on OPT subject to Social Security and Medicare (FICA) taxes, removing their prior exclusion.
Introduced September 30, 2025 by Thomas Bryant Cotton · Last progress September 30, 2025
Changes current tax rules so that wages earned by F-1 nonimmigrants while working under Optional Practical Training (OPT) are treated as covered employment for Social Security and Medicare (FICA) purposes. Employers must withhold and pay the employee and employer shares of FICA for OPT wages for calendar months beginning after the law takes effect. The change removes the specific exclusion that had previously kept OPT service outside FICA and Social Security coverage, making OPT earnings reportable and contributory to Social Security and Medicare going forward.