Medical Resident FICA Refund

We are pleased to report that we have received notification that the ChristianaCare Health Services, Inc. FICA refund claims from January 1, 1995 through March 31, 2005 have been approved by the IRS for payment. We are currently in the process of preparing the refund checks that will be sent to eligible consenting residents. Please be aware that the amount that you receive will be based on the actual amount that has been allowed by the IRS. Note that this amount may not equal 100% of your resident wages, which may have included such things as moonlighting which the IRS has not allowed as part of the settlement of the claims. We expect that all refund checks will be mailed to eligible consenting residents before June 1,2013.

Over the past several months, the IRS has been actively reviewing the ChristianaCare Medical Resident FICA claim for all years at issue and we have continued to respond to all inquiries from the IRS on a timely basis in order to ensure that refunds are processed as soon as possible. At this time, ChristianaCare has received notification that its Medical Resident FICA refund claim has been approved by the IRS. Similar to other institutions, the IRS has denied our FICA refund claim for all pharmacy residents, as the IRS has noted that such individuals fail to qualify as “Medical Residents.” Actual timing of the Medical Resident FICA refund payment from the IRS is uncertain and may take another few months. We will provide an update as soon as resident payment information is available.

At this time, the IRS is actively reviewing our Medical Resident FICA claims for all years at issue. As part of the review, the IRS has requested additional information regarding particular items included with the claim. We are responding to all inquiries from the IRS on a timely basis in order to ensure the refunds are processed as soon as possible. At this time, we are unaware as to when refunds will be issued and we will provide a further update on the timing shortly.

Based on current information, we anticipate that the process may take at least another 6-8 months as the IRS tries to work out their glitches with how to deal with all of the FICA data that they have received from numerous companies like ChristianaCare. Ultimately we do not know exactly how long it will take the IRS to review and approve the claim. As updates become available we will continue to update this website.

We have received many inquiries as to the status of ChristianaCare Health Services, Inc.’s (“CCHS”) Medical Resident FICA refund claims for the periods beginning January 1, 1995 through March 31, 2005. At the present time, the claims have been mailed to the IRS, but they have not provided any guidance as to the timeline for claim acceptance and refund issuance. We anticipate that it may take at least 6 months to one year.

We ask that if you are seeking an update on the status of the claim to please continue to visit this Medical Resident FICA link that will be updated as more information becomes available. Please note that on January 11, 2011, the Supreme Court held that Medical residents are employees for purposes of the FICA tax. The 8-0 decision upheld treasury regulations issued by the Treasury Department that wages earned by medical residents working 40 hours or more per week are subject to FICA taxes. This decision applies only to quarters beginning after March 31, 2005; it does not affect a former resident’s potential right to a refund for quarters previous to April 1, 2005 as discussed above.