H-2A Workers and Tax Withholding
In the U.S. there is a very common saying: “There are two things that are certain, death and paying taxes.” Most people who work in the United States must pay taxes. If you have an H-2A visa and work in the United States, there are certain things you need to know about paying taxes.
The first step is that you must get a U.S. Social Security Number (SSN). This will allow you to report your wages for tax purposes. In order for you to get an SSN, you need to contact the Social Security Administration (SSA). You will need to visit their office, where they will examine your U.S. Immigration documents and give you a card with your SSN.
Give your employer a copy of your SSN. If you don’t have your SSN by the time you start work, that is okay. Just make sure to give your employer a copy once you have it. Your employer is required to report your wages to the Internal Revenue Service (IRS). The SSN is used to identify your wages.
Your employer is required to report your wages to you and the IRS on a W-2 form. A W-2 form is also known as the Wage and Tax Statement. The purpose of the W-2 is to report your annual wages and the amount of taxes (if any) are taken out of your pay for the entire year. You will get one W-2 form for each job you have during the year. Your employer is required to send you this form before January 31st of the next year. For example, if you work for 2 different employers in 2020, you will receive a W-2 form each employer in January or 2021. The W-2 form is available in multiple languages, including Spanish.
For most workers, an employer is required to “withhold” taxes from an employee’s pay. The employer then pays that money to the IRS for the taxes that an employee may owe. If you are an H-2A worker, however, an employer is not allowed to withhold taxes from your pay unless you agree. We will explain more below about how to have taxes withheld from your pay.
If you agree to have taxes withheld, you should see this information on your paystubs and on your W-2. Every W-2 form looks the same no matter who you are working for. The following information is included in the W-2 form:
- Your total earnings from your employer for the last year
- The amount withheld in taxes from your paychecks, including federal income tax and Social Security tax (If you are a H-2A workers, your wages are not subject to the Social Security or Medicare taxes)
- Any state taxes withheld from your pay
You will use the information on your W-2 form to file a tax return, if required. Not every H-2A worker is required to file a tax return.
If you want your employer to withhold taxes, you will need to complete a W-4 form, which is also known as an Employee’s Withholding Allowance Certificate. By filling out this form, you are telling your employer how much money to take out of your pay. The amount depends on a number of factors, like the number of dependents you may have, your filing status, and other considerations. This form is also available in several languages, including Spanish.
The W-4 form was recently changed in 2020 to make it simpler for people to fill out. The IRS has a helpful tool online called the Tax Withholding Estimator, which allows you to calculate the correct amount to be withheld from your wages. Even though the new form is simpler, it can still be complicated to fill out. You may want to ask for help if you have questions about this form.
Whether you need to file a tax return or whether to fill out a W-4 form can be hard to figure out. You may want to talk to a lawyer if you have questions about:
- Determining if you are required to file a tax return
- Your employer withholds money from your pay without your agreement
- Your employer withholds money for Medicare and Social Security taxes
- Your employer gives you a Form 1099 instead of a W-2 form
- Your employer does not give you a W-2 or paystubs, or only pays you in cash.
Need help with any of these issues? Call the Iowa Legal Aid Farmworker Rights Project at 1-800-532-1503 ext. 1301 or WhatsApp 515-446-8718.