Long-term disability benefits are crucial to get the necessary relief during this tough period. It is also necessary to determine whether or not these payments are taxed, which depends on who pays the premium for long-term disability insurance.
Employer Pays for Insurance
If your company pays a portion or the full premium, your benefits will be considered taxable income. If your benefits are taxable, the insurance company will typically deduct taxes from each payment you receive.
You Foot the Bill
In the event that you pay the full payment, your benefits will not be taxed as income. The benefits you receive will not be reduced in any way, and you will keep all you receive.
Although the answer to this question is straightforward, it is tough to keep track of everything. Our long-term-disability lawyers understand that long-term disability claims can feel daunting, and it can be difficult to navigate the number of internet resources.