H1B Visa

Which is Better : Working in OPT or H1B Visa

Interesting Question : Work for 27 months in OPT or Apply for H1B Visa?

I am currently on my first period of OPT. End date of first OPT period would be on 6th Spet ,2013.  After applying for the STEM extension, my opt will last for 17 months.  So, the end date after utilizing complete STEM period would be 7th Feb, 2015.

I know that H1B applications are accepted from April 1st. But my OPT ends in Feb 2015 and the only way for me to get H1B is to apply for it in April 2014, which I do not want to do.  I would like to utilize my OPT completely rather than wasting it. Any suggestions?

Can I apply for CPT after Feb, 2105 and file for H1B in April 2015 Or the other way, I can take an MBA course in Jan ,2015 and switch to H1B in April 2015. Does it make sense?  I appreciate your idea behind this blog. Great work and informative.Thanks in advance.

Working in OPT or H1B Visa

I know exactly why you want to work in OPT instead of H1B Visa :  To Save money on your FICA Taxes.

My friend – You are taking a huge risk by not applying for H1B Visa when you have an opportunity.

What is your primary objective?

  • Do you want to gain experience in USA while in OPT and go back to your country?
  • Do you want to continue to live and work in USA for longer period?

Let’s say you find a job in Kentucky for $50,000 per year. You continue to work in OPT for 2 years and you don’t have to pay the FICA Taxes highlighted in Yellow below ( Social Security and Medicare). If you change the status to H1B, then you $119.23 and $27.88 will be deducted from your pacy check.


opt vs h1b

Total Savings from FICA taxes will be = $3,500

Lets say, you are not applying for H1B in April 2014 and your OPT expires in Fe/2015. Which means you have to leave the country or find another way to stay in Legal Status in USA.

If your OPT has expired, then you want to enroll in MBA, then transfer to F1 Visa and then convert to H1B from October.

Which means, you want to pay 2 semester of tuition fees $20,000 to save $3,500?

Let’s say you want to take that route of attending the college.

You apply for MBA and company files for H1B.

First – I don’t see that happening. You need to  job to file H1B. If you convert to F1, you cannot work for your employer.

But, if you have a consultancy filing your H1B in 2015 and if there is a lottery and what-if you don’t get selected in the lottery? Then what are you doing to do?

You will not get OPT after your MBA.

Now, you are thinking, Gosh.. I have to apply for H1B ASAP.

What of there is lottery and What if you don’t H1B in Lottery?

Now, you are thinking, gosh.. I should apply for H1B in April 2013.

Hope, I have explained the pros and cons of trying to save $3500.

You are willing to give-up 3 chances of applying for H1B, but willing to spend lot of money.

Even if I’m a risk taker, I wouldn’t take risk for OPT vs H1B.

What would you do?

If you have opportunity to work apply for H1B and continue to work in OPT, what would you do?

Next – How to get Refund of OPT FICA Taxes?

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  1. I am on OPT right now. However, selected and approved for H1B from 01st October 2017. My salary is approx USD 96000 per year. I am married. My wife is here in USA only. Applied for H4 Visa for her. What shall be the tax effect on my salary now and after H1B visa? Please explain.

  2. I have a curious situation and would seek some advice.I had worked in US on L1b visa from 3.5 years(Feb 2010 to August 2013).I am currently pursuing a masters here in US ( completing 6 out of 10 credits this August).I haven’t applied for F1 visa and currently on H4 visa.I had 4 courses in Spring ( mandatory for F1 visa in Spring and now in Summer have taken two courses).However for Fall. I am planning to take 1 course and and take the other 3 in Spring 2015.This is partly because of finance and family reasons(I have a 3 year old kid).Also I plan to apply for H1 in 2015 and try for a job in 2015.
    1)Am I wrong not to apply for F1 and take the advantage of the OPT?(I am currently enrolled in tuition fees and hardly manage the fees )
    2)If I complete my masters parttime will the weightage/job prospect be less?
    3)I understand that when I am on H4, the clock for 6 years stay in US is stopped but if I am on F1 OPT, the clock will be restarted?
    4)Also ,if i have to get F1, I need 4 courses in Fall which is tough with a kid
    5)There is a tax benefit for students who pay more than 10000 dollars tuition fees(as per my tax consultant)So if I split the courses ,I can earn it for 2 years.
    Please advise.

  3. With H-1B, you can work in a professional capacity for a maximum period of six years. On the other hand, the total duration of OPT (pre and post completion) is 12-17 months. For anyone who wants to work in the US, H-1B visa is the way to go. Not just work, you can simultaneously seek a Green Card on H-1B as well. But there is an annual numerical limit that is imposed on H-1B visas issued every year. So you’ll need to be mindful of the cap.

  4. Hell Raghuram,
    I am Anuraag from India Hyd. I got an admit for masters in electrical engg in UT Tyler for Spring ’14, this is the 1st admit that I received and since there is liittle time for the spring semester to start, I am planning to go with this admit, and once I land in US, I can transfer to the other univ which I may receive admit at a later stage.
    Another thing is I saw your video analysis on UT Tyler and found it quite interesting the student faculty ratio and low fee and financial support etc.,The one thing that is bothering me at this stage is about the reputation of UT Tyler and also the most important thing that is the OPT & H1B rating of UT Tyler, as in what % of students from UTT get an OPT or H1B status. Please do reply Thanks.

  5. Hey HSB,

    Very useful article ! I have a question regarding FICA taxes. As a OPT student, I am exempt from FICA taxes, but these taxes are still getting deducted from my salary. I know that I can file for refund of this money to IRS. But I was wondering if there is any way to stop these deductions from my salary itself. (So that I don’t worry about filing for a refund). I checked this with my employer. But company people were not sure. and I wanted to check with IRS but I could not due to shutdown. It will be great if you could throw some light on this.

  6. Hey HSB,

    I have been following your blog for about 4-5 years now. I have learnt a lot of things about visa issues concerning international students in US and I have recommended your blog to many of my friends and family alike.

    I would however, like to express some constructive criticism of your articles lately. They do not have as much quality material as they used to few years back. And many time I feel that you are overplaying the political and economic events that happen inside US, which seems like a trick to pull more traffic to your website but you do not present a new view or even have all the relevant details that one must know to fully understand the said event. But, I suppose that is okay, since you are not running a political or economic blog.

    I would have liked to see the actual percentage of tax increase that an individual will see in his/her paycheck when they get there first paycheck. But that was nowhere to be be found in your post. The only thing that changes in one’s tax structure when they move to H1B is FICA taxes which comprise of Social security and Medicare (at least students from INDIA). The current tax rate for social security is 6.2% for the employer and 6.2% for the employee, or 12.4% total. The current rate for Medicare is 1.45% for the employer and 1.45% for the employee, or 2.9% total. Here you can read it on IRS website- http://www.irs.gov/taxtopics/tc751.html
    It wasn’t difficult to find this information but I think your readers deserve this level of detail from your posts.

    Regards, Aman

    1. Aman – Thanks for your comments. I know exactly what you are talking about. I’m human and I can’t work 80 hour week every week which I did for over 5 years now. I’m spending the time on new project.

      For tax numbers, percentages – refer to the link within the blog post, that link was published back in 2010.

  7. One thing is that on OPT, federal withholdings are returned. I’m not talking about H1vsOPT (risk), but you do save a lot more than $3500 when on OPT, due to getting the federal tax back. You only have to pay state tax.

    1. Federal Taxes are not returned 🙂 2 Things are certain in Life. Death and Taxes. Only FICA taxes if withheld will be returned if requested.

      1. Hello HSB,

        I have a concern regarding the H1B, since I thought that you need to have a sponsorship at first in order for applying for the H1B visa. Please illustrate me about this issue.

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