Is Long Term Disability Insurance Taxed?
0 POINTSContact Meview profileDavid RacichPROFountain Hills, ArizonaIf you don’t deduct your disability insurance premium as a business expense, your disability benefits are tax free. But if you do deduct your disability insurance premium, then your disability benefits are taxable at ordinary income tax rates. The advantage of the deduction is the disability insurance company will cover up to 80% of your compensation, compared to 60% if you don’t deduct it. You need to determine you effective tax bracket rate to analyze which is better for your situation.Answered on June 23, 2013+01+1 this answer
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