In a recent Law360 article, Kat Gregor comments on a Supreme Court’s decision to grant cert to BNSF Railway Co.’s petition for review of whether payroll taxes should be deducted from compensation owed to a former employer for lost wages in connection with a workplace injury. This case is an appeal from an Eighth Circuit decision that leaves a disconnect between the definitions of taxable compensation described in the Railroad Retirement Tax Act and the Railroad Retirement Act. The IRS has historically held that taxable compensation should include pay for time lost pursuant to Treasury regulations. Kat notes that if the Supreme Court were to determine that the IRS did not have authority to issue the applicable regulations, “…it could make the IRS feel as if their hands are a little bit more tied in putting together tax reform guidance. So, it’s possible it can have an effect on new regulations.”
Click here to read the full article, including more insights from Kat.