Benefits Trade Group Defends FICA Tax Refund To High Court

Law360, New York (December 18, 2013, 6:32 PM EST) -- Severance payments made to employees whose jobs were involuntarily terminated due to their employer's bankruptcy are not taxable under the Federal Insurance Contributions Act, the American Benefits Council told the U.S. Supreme Court on Friday.

Bankrupt Quality Stores Inc. says it deserves a $1 million tax refund because supplemental unemployment compensation benefits, called SUB payments, are not considered wages under the Revenue Code, citing its long string of victories on the issue that have led to the high court battle. On Friday, the nonprofit that fights...
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