Archive · 5 Aug 2025
US Bill May End OPT Tax Exemption, Impacting International Students
A new law could make international students pay more taxes while working in the US.
The DIGNITY Act wants students in the OPT program to pay FICA taxes, which they don't currently pay.
This could cost them a lot of money.
Some people worry this could make the US less attractive for students.
The law also has other parts about immigration.
The DIGNITY Act of 2025 proposes ending FICA tax exemption for OPT students.
OPT allows international graduates up to 12 months of US work experience, 36 for STEM.
FICA taxes include Social Security (6.2%) and Medicare (1.45%) contributions.
The proposed change would add 15.3% in taxes on OPT earnings.
The bill has generated debate in higher education and immigrant advocacy groups.
- Who
- US Congress, including Congresswomen María Elvira Salazar and Veronica Escobar, international students
- What
- The DIGNITY Act proposes ending the FICA tax exemption for OPT students.
- When
- The DIGNITY Act was introduced in 2025.
- Where
- United States
- Why
- To balance immigration reform with labor protections.
Higher Education and Advocacy
USCIS, some Republican factions
Tax Fairness and Labor Protection
Higher Education and Advocacy
Taxing OPT students like domestic workers is unfair, and could discourage students from choosing the US.
USCIS, some Republican factions
The OPT program is a “workaround” for cheap labor, needing more regulation.
- Act Name
- The DIGNITY Act of 2025
- Tax Impact
- 15.3% FICA tax on OPT earnings
- OPT Program Length
- Up to 12 months (or 36 for STEM)
- FICA Components
- Social Security and Medicare
- Social Security Tax
- 6.2%
- Medicare Tax
- 1.45%
Sources
OPT students may face new tax burden on their earnings in America
Green card wait time may shorten as US bill proposes $50,000 fast-track option
US Congress may end to OPT tax exemption in DIGNITY Act: What does it mean for Indian students