The Sixth Circuit, in United States v. Quality Stores, Inc., recently affirmed a lower court decision that severance payments were not subject to FICA (Social Security) taxes. This holding is contrary to a prior decision of the Federal Circuit Court of Appeals and published IRS guidance. The government may still appeal the case to the Supreme Court; it has until April 4, 2013 to appeal. In the interim, taxpayers that have made severance payments in 2009 should file a protective claim for a FICA tax refund no later than April 15, 2013. This protective claim will preserve the taxpayer’s right to a refund should the IRS not appeal the decision or should the decision be upheld on appeal.