Participating in Social Security withholding is mandatory for nearly everyone who earns income in the United States. You won't be able to simply ask your employer to stop deducting Social Security from your paychecks because you'd prefer not to contribute for personal, political or financial reasons. However, there are some valid exemptions available for qualifying taxpayers that make it possible to opt out of having Social Security deductions taken from paychecks. Here's a glimpse at the four main categories that can qualify for exemptions under certain circumstances:
- Students who are employed by the colleges and universities they attend.
- Foreign workers not planning to immigrate to the United States.
- Some members of the clergy.
- Conscientious/religious objectors with beliefs that prohibit them from participating.
Read More: How to Stop Deductions of FICA
Keep in mind that the religious exemption for opting out of Social Security deductions is strict. Only members of recognized religions formed prior to 1950 can qualify. If this applies to you, you'll need to let your employer know ahead of time that you're filing for an exemption to cease your payroll deductions.
Read More: How to Adjust Social Security Withholding
Which Form Should You Use to Stop Social Security Deductions?
The IRS doesn't provide a general form for declaring a Social Security exemption for all taxpayers. There are several highly specific forms to use when ending Social Security deductions. It's important to use the right form based on your reason for opting out of deductions. Here's the rundown:
- File IRS Form 4361 if you are a clergy member seeking an exemption from self-employment tax.
- File IRS Form 4029 if you are a member of a qualifying religion.
- Use Form I-94 Arrival and Departure Record or Form I-20 Certificate of Eligibility for Non-Immigrant Student Status if you are currently working in the United States without plans to immigrate.
- File as exempt from withholding on your W-2 if you're a qualifying student.
It's important to confirm that you are exempt from withholding if you intend to claim this status. If you mistakenly claim yourself as being exempt from withholding, you will receive a large tax bill once the IRS discovers your mistake. You may also be charged penalties for essentially failing to pay your taxes in full. It's also important to check state laws before claiming that you're exempt from withholding. Laws regarding what qualifies students and foreign workers for exemptions can vary by state.
Read More: What Is FICA Tax Withholding?
Final Thoughts on Stopping a Social Security Deduction on Your Paycheck
Overall, stopping the Social Security deduction is simply not something that's in the cards for most people. Every self-employed person and wage recipient is expected to pay what they owe in Social Security withholdings every year. It's also important to emphasize that simply disagreeing with Social Security taxes isn't considered justification for failing to pay what you owe in the eyes of the law. It will be considered tax evasion if you make the decision to stop withholdings.
Be prepared to prove that you belong to a qualifying religious group if you opt to stop withholdings based on religious grounds.
Read More: Do You Pay FICA on 401(k) Contributions?
- IRS: About Form 4361, Application for Exemption From Self-Employment Tax for Use By Ministers, Members of Religious Orders and Christian Science Practitioners
- IRS: About Form 4029, Application for Exemption From Social Security and Medicare Taxes and Waiver of Benefits
- CBP: Definition of an I-94
- DHS: I-20, Certificate of Eligibility for Nonimmigrant Student Status
- If your employer has deducted for Social Security from your paycheck but you are exempt from paying Social Security taxes, you may be able to ask for a refund directly from your employer. Otherwise, file IRS Form 843 to claim a refund based on the improper deductions.
- Don't attempt to file a Form 4029 if you are merely personally opposed to paying the Social Security tax. Some political or religious groups erroneously assert you can qualify for an exemption. You must be able to prove you belong to qualifying group outlined on the form.
Adam Luehrs is a writer during the day and a voracious reader at night. He focuses mostly on finance writing and has a passion for real estate, credit card deals, and investing.