FICA exemption applies to both H-2A and H-2B visa holders

Plain-English summary

Chief Counsel advised that IRC § 3121(b)(18) applies to both H-2A and H-2B visa holders. The statute refers to H-2 workers and does not distinguish between agricultural H-2A workers and non-agricultural H-2B workers. Because the statute is clear as written, the advice found no need for a regulation to clarify the scope of the exemption, although the IRS could clarify the issue in the Internal Revenue Manual if it recurs.

Ruling snapshot

• Question: Does the FICA exemption in IRC § 3121(b)(18) apply to both H-2A and H-2B visa holders?
• Outcome: Advice given, the exemption applies to both visa categories
• Key authorities: IRC § 3121(b)(18); 8 U.S.C. § 1101(a)(15)(H)(ii)

Full text (IRS public release)

ID: CCA_2013082910542296 Third Party Communication: None

UILC: 3121.00-00 Date of Communication: Not Applicable

Number: 201411020
Release Date: 3/14/2014
From:
Sent: Thursday, August 29, 2013 10:54:22 AM
To:

Cc:
Bcc:
Subject: H-2 Question

Greetings everyone,

Section 3121(b)(18) only refers to H-2 (actually, 101(a)(15)(H)(ii)) and does not make any distinction between H-2A and H-2B visas. As written, this would encompass both H-2A and H- 2B visa holders. We apply the statute as written unless and until Congress amends it to clarify that the FICA exemption extends only to H-2A or H-2B. As section 3121(b)(18) plainly reads, the exemption applies to the H-2 visa, which would include both As and Bs. In addition, both H-2A and H-2B visas are geared toward temporary workers, with the distinction being between agricultural workers and non-agricultural workers. Section 3121(b)(18) clearly speaks only of temporary H-2 workers, without any distinction between the nature of the work. I don’t see any need to clarify this issue in a regulation because section 3121(b)(18) is clear on its face and applies to both H-2A and H-2B visa holders. However, we could clarify in the IRM, if this is a recurring issue and would be helpful to the field.

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