Medical Resident FICA
BACKGROUND: IRS takes the position that Medical Residents are not students and their
wages are subject to FICA (Social Security and Medicare taxes). That position has been
challenged by several universities resulting in decisions in various U. S. District Courts.
Some cases have been decided in favor of the taxpayer; others were in favor of IRS.
MUSC POSITION: MUSC will continue to withhold FICA on Medical Resident wages
pending final legislative or judicial decision.
2005 FORWARD: MUSC has filed claims for both the employer and employee share of
FICA for 2005 and intends to file for subsequent years. MUSC may or may not be granted
a refund of those taxes. If a refund is received, MUSC will be paid the entire employer
share, but will receive the Resident’s share only for those Residents who sign a Consent
Form. When the issue is resolved, if MUSC receives a refund, MUSC will pay each
Resident who signed a Consent Form his/her withholding as refunded to MUSC by IRS.
1996 – 2004: MUSC has filed claims for refund of the employer share of FICA for 1996 -
2004. Residents were given instructions how to file claims for their share of the FICA for
those years. To date IRS has not issued refunds to MUSC.
OPTIONS FOR RESIDENTS: Each Resident has three options: (1) sign the Consent
Form for MUSC to file on the Resident’s behalf, (2) file his/her own claim with IRS, or (3)
do nothing. Please see the information below for each option.
1. To be included in the University’s claim, print and complete the Consent
Form below. Sign the form and send it to Medical University of South Carolina,
Attn: Resident FICA Claims, 19 Hagood Avenue, Suite 505, MSC 817, Charleston,
SC 29425-8170. Be sure to provide address changes as instructed on the form.
2. To file on your own behalf, consult your tax advisor about properly filing
Form 843 and attachments.
3. If you choose to do nothing, you may lose the opportunity to later claim a
refund of the FICA taxes withheld from your Resident wages.