March 3, 2010

IRS To Refund Taxes Paid By Some Medical Residents

By Kelley Luckstein

The U.S. Internal Revenue Service said Tuesday it will refund Social Security and Medicare taxes paid on behalf of medical residents prior to 2005. The news appeared to be a total victory for several of the nation's largest teaching hospitals, which have battled the IRS in court over the taxes for more than a decade…


But it is likely to bring a halt to lawsuits pending in several federal courts. Hospitals including the Mayo Clinic, Mt. Sinai Medical Center, Memorial Sloan-Kettering Cancer Center and the University of Chicago Hospitals challenged the IRS position that residents were not covered by the student exception prior to 2005…


But the Eighth Circuit in June ruled in the IRS favor, finding that the Mayo Clinic and University of Minnesota could not rely on the student exception in the case of medical residents.


MorningStar, by Martin Vaughan – Dow Jones Newswires, 3/3//10


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Tags: Education, IRS, Legal / Leadership, medical residents, taxes

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