Hi,
I have started working with my company (a big international company with +5,000 employees) under F-1 OPT and no social security and/or medicare tax deductions have been made, as it should be. However, 6 months after my hire, I switched to H-1B. I did not know it at the time, but know it now, that my company should have updated my files such that SS and medicare taxes should have been deducted from my paycheck. Well, they did not update my records and did not pay SS and medicare.
IRS, however, performed an audit of my company's tax records for the last 3 years and found out that no SS or medicare taxes have been deducted from my paycheck. Of course, my company did not pay their portion, either. Since IRS found this out and requested the money, my company paid them the entire balance with one check (including all company dues and my portion). After that my company contacted me and told me that they will deduct this money from my paycheck over a 3-year period. Suddenly, I started to pay for the SS and medicare taxes AND the taxes for the previous three years, which is a considerable income loss as you may imagine.
My question is, since updating my records was my company's responsibility, and I did not do anything wrong during this period, is it possible for me to argue that my company cannot ask me to pay the money they paid to IRS even though it was "my portion". More importantly, I will leave my company in two months and am afraid that they will withhold my earned vacation time (which is employee's time and should be paid to him/her when the employment ends) and 401K company shares to cover their expense. I am moving out of US and do not have a problem to go to the court for this issue, if there is hope to win the case.
I will appreciate all kind responses.
I have started working with my company (a big international company with +5,000 employees) under F-1 OPT and no social security and/or medicare tax deductions have been made, as it should be. However, 6 months after my hire, I switched to H-1B. I did not know it at the time, but know it now, that my company should have updated my files such that SS and medicare taxes should have been deducted from my paycheck. Well, they did not update my records and did not pay SS and medicare.
IRS, however, performed an audit of my company's tax records for the last 3 years and found out that no SS or medicare taxes have been deducted from my paycheck. Of course, my company did not pay their portion, either. Since IRS found this out and requested the money, my company paid them the entire balance with one check (including all company dues and my portion). After that my company contacted me and told me that they will deduct this money from my paycheck over a 3-year period. Suddenly, I started to pay for the SS and medicare taxes AND the taxes for the previous three years, which is a considerable income loss as you may imagine.
My question is, since updating my records was my company's responsibility, and I did not do anything wrong during this period, is it possible for me to argue that my company cannot ask me to pay the money they paid to IRS even though it was "my portion". More importantly, I will leave my company in two months and am afraid that they will withhold my earned vacation time (which is employee's time and should be paid to him/her when the employment ends) and 401K company shares to cover their expense. I am moving out of US and do not have a problem to go to the court for this issue, if there is hope to win the case.
I will appreciate all kind responses.