As of April 1, 2005, resident pay is no longer assessed FICA taxes because residents are considered students and thereby fulfill the “student exemption” under FICA. However, resident pay taxed prior to that date is eligible for a refund.
Cincinnati’s University Hospital is one of the first hospitals to file for and receive its refund. The hospital and nearly 1,000 residents who were at the hospital between 1997 and 2005 will split an approximately $20 million refund, according to a report by the Cincinnati Enquirer.
Medical residents are still required to pay into Social Security. However, the Supreme Court agreed in June to hear a case filed by the Mayo Clinic and the University of Minnesota contesting the Treasury Department’s decision to levy Social Security taxes on the residents.
Read more about medical resident taxes:
– U.S. Supreme Court Agrees to Hear Mayo Clinic Case on Residents’ Pay
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