Excerpt: Certain severance benefits may not be subject to taxation under the Federal Insurance Contributions Act (FICA), according to a recent district court decision. In United States v. Quality Stores, Inc., No. 1:09-cv-44 (W.D. Mich. Feb. 23, 2010), a decision affirming a bankruptcy court decision, the U.S. District Court for the Western District of Michigan highlighted the historical uncertainty regarding whether certain severance payments made to employees are subject to taxation under FICA. In this episode, the court held that such payments were not subject to FICA, as they did not constitute 'wages.'  MORE >>