I want my Social Security back
Social security is a tax paid by every person working in the US. This is money that you put into the system and when you retire, the government will pay you a monthly pension. That is a very simplistic explanation of something that is complex.
This tax is also paid by employees on H1-B. Typically H1-B employees return back to their country after their 6 year period is over. A large percentage stay back as they move on to the next level in the immigration ladder, the Green Card.
Now what becomes interesting is the fact that about 6.25% of your salary is paid by you as SS tax and the employer matches that. Thats a hefty 12.5 %. On an average if a IT person makes a median salary of 100K over the six years that’s 12.5% of 600K US$, which is a cool 75K US$. At todays rate it is about 33 lakh rupees.
Now for all these years the US government does not have the mechanism to refund this money. I am sure statistics exist somewhere which will point out to the number of people who return back to their country at the end of the 6 year period.
For all those people and those who will be in a similar predicament in the future, there seems to hope in getting that money back.
The Indian government is going to bring this issue to the discussion table when George Bush visits India early next month on a state visit.
According to the TOI
“They (Indian professionals) can’t (get benefits) because they are in H1-B visas and they get to stay in the US for three years plus three years — maximum of six years. Social security benefits come only if they are there for ten years. Argument has been that some of them transit to green card. But they are a small number. So, we have suggested a practical solution. If you (US) can’t stop deductions (social security taxes), collect them and when the person (Indian professional) leaves, refund it,” he said.
On L1 visa, he said the fee structure or new restrictions should not be adverse.
It should be interesting to watch how this one plays out.
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