A university and the federal government have agreed to resolve a lawsuit over taxing medical residents.
Saint Louis University sued the U.S. government last fall alleging it overpaid $24.6 million in Social Security and Medicare taxes from 1995 through March 2005.
Several other teaching medical programs have made similar claims, including Barnes-Jewish Hospital, which sued seeking a nearly $25 million refund. That case is pending.
The IRS in March said it wouldn’t fight the position that medical residents who worked before a new rule took effect in April 2005 were exempt from paying the taxes.
Filings in the SLU case refer to the IRS’ announcement, but the court’s order of dismissal doesn’t say how or to what level the university is being reimbursed.
The Department of Justice declined to comment, and a SLU spokeswoman had no details available. The school’s attorney didn’t immediately return a call.
The case is Saint Louis University v. U.S., 4:09-cv-01483.