• The Sixth Circuit Splits From the Federal Circuit and Rules That Severance Payments Are Not Taxable as FICA Wages
  • September 26, 2012
  • Law Firm: Sutherland Asbill Brennan LLP - Washington Office
  • On September 7, 2012, the Sixth Circuit held that certain types of severance payments (referred to as supplemental unemployment compensation or “SUB payments”) are not taxable wages under FICA. United States v. Quality Stores, Inc., No. 10-1563 (6th Cir. 2012). In so holding, the court declined to follow IRS revenue rulings and also declined to follow the Federal Circuit’s contrary decision in CSX Corp. v. United States, 518 F.3d 1328 (Fed. Cir. 2008).