Resident FICA Refunds

The Internal Revenue Service (IRS) announced on March 2, 2010, that it had made an administrative determination that medical resident stipends are exempt from FICA taxes for tax periods before April 1, 2005 based on the "student FICA exception."  A copy of the IRS announcement and IRS Q&A regarding the refund procedure can be accessed here:  

http://www.irs.gov/pub/irs-tege/nr-2010_25.pdf 

http://www.irs.gov/charities/article/0,,id=219547,00.html.

Eastern Virginia Medical School (EVMS) had filed protective claims on behalf of its medical residents for stipends EVMS paid between January 1, 1996 and December 31, 2003.   In order to receive their portion of the refunded taxes pursuant to the determination, eligible residents were required to "opt in" by signing a consent letter.  EVMS made several attempts  to locate addresses of eligible former residents using a variety of sources,  including a national search firm.  EVMS also engaged the audit, advisory and tax service firm KPMG LLP to assist with the process.  Consent letters from eligible residents were collected by KPMG from September, 2010 to December, 2010.  If you did not receive a letter, you were either deemed to be ineligible for a refund or we were unable to locate you.  As EVMS filed the final claim with the IRS in January 2011, consent letters are no longer being generated or accepted. 

If you received and returned a consent letter, be advised that it could take a considerable amount of time for the refunds to be processed and the IRS has not established a timeframe for the issuance of refunds.  Please also note that the IRS may reject or modify some claims.  If your claim is rejected or modified, we will advise you accordingly. 

UPDATE: November 7, 2011. We have been advised that the IRS currently has the EVMS claim under review for approval. When asked, they could not say how long it would take to remit the claim after it is approved. The claim is accruing interest which will be remitted along with the actual claim. They did indicate claims for the following specialties would be denied: Psychology Fellows; Psychology Internship; and, Research Assistant Fellow.

UPDATE: June 12, 2012. We have been actively working with the IRS over the past six months to finalize the claim. The claim is in final review and is anticipated to go to the social security administration for payment in August or September 2012. At that time, we will be notified what claims were approved or denied and can start preparing to remit funds to residents upon receipt of payment from the social security administration. It is unknown how long it takes for the social security administration to remit payment but we will process refunds timely after the payment is received.

EVMS will post updates related to the Medical Resident Refund Claims process as we receive additional information from the IRS.  In the meantime, if you have additional questions, please email residentfica@evms.edu This e-mail address is being protected from spambots. You need JavaScript enabled to view it .

UPDATE: December 21, 2012.  FICA tax refund checks for eligible residents were mailed on December 21, 2012.  Payment includes the FICA tax refund (“claim”) and interest on the claim.  Recipients will receive two separate tax forms from EVMS.

  1. For the claim itself, which represents the refund of the FICA taxes withheld while resident at EVMS, recipients will receive Form W-2c, Corrected Wage and Tax Statement, for each of the affected calendar years.
  2. For the interest on the claim, recipients will receive Form 1099-INT, Interest Income, for calendar year 2012.

Form W-2c’s will be mailed early January 2013 and the Form 1099-INT towards the end of January.

EVMS engaged KPMG LLP to assist with the medical resident FICA claim refunds.  If you have any questions about your refund, please contact KPMG via email at us-taxets-evms@kpmg.com or telephone at 1-855-749-4630.  The telephone number is a voicemail box where you will be able to leave a message. Your message will be responded to within one business day starting January 2, 2013.