Question:

Are disability benefits taxable?

Answer:

Generally, short term disability (STD) benefits are not taxable. You are required to pay the premiums yourself, with post-tax dollars, for your STD plan. This makes your STD benefits nontaxable; however, we are legally required to report the amount of STD benefits paid to you. Generally, long term disability (LTD) benefits are 100% taxable. The WEA Trust will withhold FICA taxes as required by law. You may choose to have federal and/or Wisconsin state income taxes withheld from your LTD benefit. To have federal and/or state income taxes withheld from your LTD benefit, you must complete the appropriate withholding form. You may contact us to have the appropriate form mailed to you. If you have questions about the amount of federal and/or state income taxes that you should withhold from your LTD benefit, please consult your tax advisor. We cannot provide specific advice on the amount of taxes you should have withheld from your LTD benefits because each person's tax situation is different. We will mail a W-2 form or other tax information for tax reporting purposes by January 31 every year if you received STD and/or LTD benefits in the previous calendar year.