If the request is approved, it would grant a FICA tax exemption for students employed on campus. UT officials support the student tax exemption because the University would save millions by not being required to match the tax dollars students pay into social security. I'm very optimistic that it will happen. Texas, New Jersey and Pennsylvania are the only three states to require its students to pay the social security tax. Other students throughout the country have been exempt since 1983.
Students working their way through school earn little enough as it is.
The tax cut would affect 30,000 Texas students, primarily graduate students, said Kelly Fero, a spokesman for Sharp. We're happy to get anything we can get to help us out financially. Sharp wrote a letter in June to members of the Texas congressional delegation to explain the tax inequity. The tax imbalance with other states dates back to 1950, when the Social Security Act was passed and Texas chose to place all higher education employees under the law, Fero said. States were given another opportunity to exempt students from the tax in 1983, but Texas declined to do so.