Oral argument: Nov. 8, 2010
Appealed from: United States Court of Appeals for the Eighth Circuit (June 12, 2009)
MEDICAL RESIDENTS, CONGRESSIONAL INTENT, FICA, REGULATIONS, CHEVRON DEFERENCE
The Mayo Foundation is suing for a refund of FICA taxes paid on behalf of its medical residents. The IRS claims that medical residents are not students and thus are not eligible for the FICA exemption for student employment. The Treasury Department released regulations that deny the student exemption to any employee that works more than 40 hours per a week. The Mayo Foundation contends that the IRS’s interpretation of the term “student” is incorrect and contrary to congressional intent. If the court rules that medical residents are students, this could lead to significant tax savings for hospitals and residents while reducing the availability of worker protections for medical residents.