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Medical Resident FICA Forum
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Hit to my Social Security Benefit

As I am sure you know there has been debate regarding whether medical residents should pay FICA taxes. I recently received a letter from BIDMC (my employer at the time) about filing a claim for return of my FICA taxes paid from 1999 to 2005 on behalf of all housestaff who worked there during that time period. It sounds like recent court decisions support this claim and that my participation (which is optional) would likely result in return of these taxes for this period.

I know you may not be able to comment on this but I am wondering of course how this would affect my social security. Of course I am inclined to participate as it would be a substantial amount of money >$10,000. I can of course call social security directly but wondering if you had any thoughts or comments about this issue or if you could recommend the appropriate resource to get further info.

Re: Hit to my Social Security Benefit

The way Social Security currently works, is that every who reaches retirement age calculates their retirement benefit based on their 35 highest years of income. So if you get your FICA taxes refunded, you might be replacing one or more years with qualifying wages with years of no wages. This might cause you to end up your working career with fewer than 35 years of Social Security wages, which would, in turn, cause the retirement benefit you ultimately receive to decrease.

There are some good tools available at the Social Security Administration website, www.ssa.gov. One tool lets you tinker with assumptions and gives you an estimate of your specific retirement benefit.

Please let us know what you learn if you spend some time using these on-line tools.

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