CWSP & Student Questions

Do student workers have to pay taxes?

FICA/DISABILITY TAX:

  • Student Workers (including CWSP and Graduate Assistants) are exempt from FICA & Disability tax under the following conditions:
  • are enrolled at least half-time status (i.e., 6 undergraduate units or 4 graduate units)
  • are not in a benefits-eligible job at USC, and
  • file a Student W-4 Form.

FEDERAL & STATE WITHHOLDING:

  • These taxes are based on the gross income, the marital status, and number of allowances claimed. Students are NOT automatically exempt from Federal or State Withholding. See the Tax Questions.
  • Note that student workers are not eligible for Unemployment Compensation.
  • US and Permanent Residents are subject to income tax reporting and taxation. Non-Resident Aliens should refer to the Non-Resident Alien (NRA) Questions for more information.

Who can file a Student W-4 Form?

  • A student enrolled at USC in at least 6 undergraduate units or 4 graduate units, must file a Student W-4. Post-doctoral students and fellows, medical residents or interns, or career employees may not complete a Student W-4.

Why do I have FICA taxes withheld?

  • You will have FICA withheld during the school year if you are enrolled less than half-time status in a semester, or if you are not enrolled in at least one session during the summer.

Why am I not having FICA withheld?

  • Work performed for USC by a student enrolled at least half-time during the semester (or in at least one session during the summer) is exempt from FICA. This exemption does not apply if you are a post doctoral student, post doctoral fellow, medical resident or intern, or a career employee.

If I’m from out-of-state, which state do I list as my “permanent residence”?

  • For tax purposes, you must list “California” as your permanent residence. If you work for USC, you are subject to California State taxes.

How are stipends awards (scholarships) handled?

  • US CITIZENS AND PERMANENT RESIDENTS:
    Disbursement Control generates stipend checks for US Citizens and Permanent Residents. Checks or Direct Deposit advice slips for “non-qualified” scholarships are mailed to your home address, so be sure your home address is accurate on the Student System. “Qualified” scholarship awards are credited directly to your student account. If you have questions regarding your stipend award, contact your department’s Financial Aid Coordinator.
  • NON-RESIDENT ALIENS:
    University Payroll Services generates stipend checks for Non Resident Aliens. If you are a Non-Resident Alien, you must complete and submit the Form W8-BEN along with a valid social security number and a copy of your social security card to University Payroll Services. NRA stipend checks are mailed to your home, so be sure your home address is accurate on the Payroll system. Direct Deposit is not available for NRA stipend checks. See the Non-Resident Alien (NRA) Questions  for more information.