Home > Business and Policy Areas > Tax > Tax News

Court Rules Medical Residents Subject to FICA Withholding

January 27, 2005

The federal district court for the Southern District of Florida has ruled that medical residents are not eligible for the student employee exemption from FICA taxes. The government's motion for summary judgment was granted in the case of Mt. Sinai Medical Center v. United States.  The case involved medical residents training and providing patient care at the Miami Beach teaching hospital.

Rejecting the Eighth Circuit opinions in the University of Minnesota and Mayo Foundation cases, U.S. District Court Judge Alan S. Gold interpreted the legislative history of section 3121(b)(10) to conclude that Congress has always intended medical and dental interns and residents to be covered by Social Security.  In the opinion, Judge Gold explained why he declined to follow the recent student FICA exception decisions.  He found the facts in Minnesota v. Apfel, 151 F.3d 742 (8th Cir. 1998) to be distinguishable from the Mt. Sinai case and the holding of U.S. v. Mayo Foundation, 292 F.Supp.2d 997 (D. Minn. 2003) to be incorrectly decided.