FICA Refund
Status Update - May 10, 2013
Partners HealthCare has received the vast majority of the Medical Resident FICA refunds applied for (except see BWH 1996 below) and as a result we will be mailing refunds to eligible former residents and clinical fellows by May 17th. These refunds will be mailed to the most up-to-date address obtained through this refund process. Please allow the United States Postal Service a reasonable amount of time for delivery before you inquire about the status of your specific refund.
Note that the mailings will contain one check and one statement regardless of the number of years in training and the number of training institutions. The statement will show the breakout between principal and interest. As you may recall, we are required to issue Form 1099-INT to each recipient that receives interest in excess of $600, as well as a Form W-2C for each tax year for which a FICA refund was received. These forms will be issued to you in January 2014, so please continue to update us with any address changes by sending the information to phstax@partners.org.
Please note that we are not able to take calls with questions regarding this refund process, so please forward your questions to phstax@partners.org and we will respond as quickly as possible.
BWH 1996 Claim:
The Internal Revenue Service has rejected both the employee and employer portions of The Brigham and Women's Hospital 1996 claim - Partners has appealed that decision. Further developments regarding this appeal will be posted to this web site. If we are successful in our appeal, we will refund the employee portion to eligible former residents and fellows at a later date.
Status Update, March 25, 2013
Partners HealthCare contacted the IRS in order to get an update on the status of the refund checks that were expected by mid-March. We were informed by the IRS that there has been a delay in the issuance of these checks and we have not been able to obtain a commitment as to a specific date.
Please understand that the timing of when we receive the refund checks is not under the control of Partners HealthCare and we appreciate your patience throughout this process. We will post an update to this web page as soon as we receive all the checks from the IRS and we will send you your refund check as soon as possible thereafter.
Please forward updated mailing address information to phstax@partners.org.
Status Update, December 2012
The IRS has just completed its review of the Medical Resident FICA refund claims that were filed by Partners. We expect to receive the IRS refund checks for all approved refund claims through the end of the calendar year and into early 2013. We will begin the process of refunding former trainees who previously timely mailed their consents once Partners has received all the refund checks for all the included years. Included in this process is the preparation of Forms W-2C and Forms 1099-INT for each consenting former trainee.
At this time, our best estimate for completion of the refund process is by March 31, 2013. Please be sure to forward updated contact information to phstax@partners.org.
Status Update, April 2012
The Partners FICA refund claims were filed with the IRS and they are actively reviewing these now. The IRS has not provided a timeline for completion of the review nor issuance of the refunds. Please check back periodically as substantive developments will be posted to this website.
Status Update, May 2011
Status of FICA Refund Claims (through March 31, 2005):
Partners HealthCare System is continuing to pursue FICA refund claims. The deadline for submission of consent forms to be included in the claim has passed.
There is no estimate of when the IRS will issue refunds and therefore we are unable to estimate when Partners HealthCare System will issue refund checks to eligible former trainees.
Updates will be provided as new information is received.
Update: Supreme Court Ruling:
The Supreme Court has upheld the decision of the 8th Circuit Court of Appeals in the case Mayo Foundation for Medical Education and Research v. United States. The court held that Treasury Regulation §31.3121(b)(10)–2(d)(3)(iii) is valid and enforceable and that medical residents, therefore, are NOT exempt from FICA taxes for time periods beginning on or after April 1, 2005 . This decision does not in any way affect claims for refunds of FICA taxes withheld for time periods prior to April 1, 2005, which claims continue to be processed with the IRS.
Update: Deadline extended to consents postmarked no later than February 3, 2011
To: Partners' Medical Interns, Residents, and Fellows
Re: Partners HealthCare System Medical Resident FICA Refund Claims
Dear Sir or Madam,
As you may know, Partners HealthCare System ("Partners," including Brigham and Women's Hospital and Massachusetts General Hospital) has filed claims for refund of social security and Medicare taxes paid on wages earned for services performed by medical residents for certain tax periods ending before April 1, 2005. These taxes are Federal Insurance Contributions Act (FICA) taxes and the claims are referred to as Medical Resident FICA Refund Claims (or MR claims). Our records indicate that you were a resident or fellow at Partners at some point before April 1, 2005. Accordingly, you may be eligible for a refund of FICA taxes that were withheld from your pay during that time.
It is not yet clear whether the IRS will allow refunds for former interns, residents and fellows employed by other Partners affiliates such as Faulkner Hospital, McLean Hospital, Newton-Wellesley Hospital, North Shore Medical Center (f/k/a Salem Hospital) and Spaulding Rehabilitation Hospital. If you were an intern, resident or fellow at any of these Partners affiliates, please fill out the enclosed consent form and submit it as directed.
On March 2, 2010, the IRS announced it would honor the MR claims. After we perfect our MR claim(s), the IRS will verify the amount of the MR claim(s) and begin issuing refunds plus interest. Please note that whether or not Partners actually obtains a refund from the IRS depends upon whether the claim is approved by the IRS, and whether Partners filed a protective claim for the particular year. Such approval is contingent upon a number of factors, and it is possible that the claim, or certain years in the claim, may not be approved by the IRS. We cannot receive a refund of the FICA taxes that were withheld and paid on your behalf unless we have your written consent. If you do not consent to have Partners obtain your refund, you may be precluded from receiving any refund of the FICA taxes withheld and paid on your behalf because the time period for filing an individual claim for refund with the IRS may have expired. .
If you consent, Partners will pay you your FICA tax refund, plus interest, after we receive the refund from the IRS. The FICA tax refund is not taxable; however, the interest on the refund is taxable to you whether or not you receive a Form 1099-INT, Interest Income. Partners is required to file Form 1099-INT with the IRS and furnish a copy to you if we pay you interest of $600 or more in a calendar year.
In addition, Partners will file Form W-2c, Corrected Wage and Tax Statement, with Social Security Administration (SSA), and furnish a copy to you for each tax year for which you receive a refund of FICA taxes. In most cases, Form W-2c will show a reduction in your earnings for social security coverage purposes in an amount equal to all the wages you were paid for services performed as a medical resident. Social security benefits are based on your earnings over your working lifetime. Accordingly, based on your personal circumstances, a refund could have a detrimental effect upon disability, survivors, or retirement benefits that you, or your family, are receiving or may seek to receive in the future. If you want information about the effect on your social security benefits, you should contact SSA directly at 1-800-772-1213 (toll free). If you call or visit a Social Security office, please have this letter with you. It will help SSA answer your questions. You might want to review your social security record before and after your refund has been processed. You can use your current Social Security Statement or you can request a copy of your Social Security Statement at the following link: http://www.ssa.gov/mystatement.
To consent to receive your share of the refund from Partners, you must complete the Medical Resident Consent Form and send it to PricewaterhouseCoopers, who is working with Partners on this initiative, at the address shown at the bottom of the consent form. Your consent form must be postmarked no later than February 3, 2011. If you have already recently submitted a Medical Resident Consent Form to PricewaterhouseCoopers for your residency at Partners, no additional action by you is necessary at this time.
If you have already claimed and received a refund or credit for FICA taxes that were withheld from medical resident wages, or if you filed an individual refund claim for such FICA taxes and that claim is still pending with the IRS, then we will not be able to file your MR claim for the year(s) that you received a refund or credit or have a pending refund claim. If you have a pending refund claim with the IRS, you may consider withdrawing it and joining the Partners claim. The IRS may contact you about your pending claim. You may wish to consult your tax advisor regarding this decision. This restriction does not apply if you filed a refund claim and it was rejected by the IRS. If we can file your MR claims for some years, but not others, check “Yes” for the years you are eligible or “No” for the years you are not eligible.
If you consent to be part of Partners' MR claim and the IRS determines that you are ineligible for a refund because you already received a refund based on an individual claim you filed, the IRS will not refund your share to us and this information may be disclosed to us.
If you consent to have Partners process the refund claim on your behalf, it is your responsibility to contact Partners to update your contact information, including your mailing address, if that information changes during the pendency of the refund claim. Please submit any updates to your contact information electronically to partnersficarefund@us.pwc.com or by mail to:
PricewaterhouseCoopers, LLP
c/o Partners HealthCare System FICA
125 High Street Boston, MA 02110
If you have any questions, please review the frequently asked questions and additional information as the claim filing process progresses. You may also email partnersficarefund@us.pwc.com. Please include your name, telephone number, and years of residency or fellowship in your email message. Your inquiry will be answered by email as soon as possible.
Very truly yours,
Partners HealthCare System, Inc.
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