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Category: Credits

What types of income does the IRS consider "Taxable Disability Income"?

Generally, disability income is the total amount you were paid under your employer's accident and health plan or pension plan that is included in your income as wages or payments instead of wages for the time you were absent from work because of permanent and total disability.


However, any payment you received from a plan that does not provide for disability retirement is not disability income.


Disability income does NOT include any amount you received from your employer's pension plan after you have reached mandatory retirement age. Mandatory retirement age is the age when your employer's retirement program would have required you to retire were you not disabled.


For more information about taxable disability income, see IRS Publication 525.

What is Permanent and Total Disability?