Quality Stores, Inc. v. United States (In Re Quality Stores Inc.)

OPINION REGARDING SEVERANCE PAY AND FICA CONTRIBUTIONS

JAMES D. GREGG, Chief Judge.

I. INTRODUCTION

Employees of Quality Stores, Inc., et al. (“Debtors”) received severance pay resulting from their involuntary termination from employment because of business cessation. The money received, without ques tion, constitutes “income” within the meaning of the Internal Revenue Code. The question is whether the receipt of the severance pay by the employees constitutes “wages” as well. “Income” and “wages” are not coterminous. Under the facts, of this case, where is the legal boundary line between…