Medical Residents FICA Litigation: Supreme Court Rules That Residents Are Not Students
Under the regulation, any employee of a “school, college or university” who works 40 hour or more hours a week is ineligible for the student exception, regardless of educational value of the work performed. Due to the rigorous nature of residency training, the regulation has the practical effect of subjecting all medical residents to FICA taxes. Applying the deferential Chevron standard for review of administrative regulations, the Court held that the Treasury Department “did not act irrationally in concluding that these doctors – ‘who work long hours, serve as highly skilled professionals, and typically share some or all of the terms of employment of career employees’ – are the kind of workers that Congress intended to both contribute to and benefit from the Social Security system.”
If you have any questions concerning the issues raised in this alert, please contact the authors of this alert, Brent Powell, David Hamilton, Tom Stukes, Mark Horoschak or Jimmy Powell or any of our other experienced Health Care attorneys.
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