University of Pittsburgh v. United States

*166OPINION

FUENTES, Circuit Judge.

The issue in this case is whether early retirement payments made by the University of Pittsburgh (the University) to its tenured faculty are taxable as “wages” under the Federal Insurance Contribution Act (FICA), 26 U.S.C. § 3121-28. From 1996 to 2001, the University paid over $2 million in FICA taxes on these payments. In 2001, however, it sought a refund from the Internal Revenue Service (IRS), on the ground that the early retirement payments were not “wages,” but instead were “buy outs” not subject to FICA taxes. The IRS denied the refund, and the University…