The Supreme Court of the United States has decided in favor of the Internal Revenue Service in United States v. Quality Stores, Inc., holding that severance payments made pursuant to plans that did not tie payments to the receipt of state unemployment insurance are subject to Federal Insurance Contributions Act (FICA) tax.  The decision overturns a taxpayer-friendly decision from the U.S Court of Appeals for the Sixth Circuit, which, if upheld, could have resulted in FICA tax refund claims to individuals and employers.

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