If you’ve been dealing with a work injury and everything that goes along with being on worker’s comp, the last thing you want to worry about is taxes.
Well, I’ve got some good news for you regarding these taxes. Yes, I used “good news” and “taxes” in the same sentence!
Are time loss payments taxable?
Total Temporary Disability (TTD), often also referred to as time loss or wage replacement payments, are *currently* non-taxable by the IRS, and are not considered earned income. The same is currently true for Total Permanent Disability payments or “Pension” payments.
What if I’m receiving social security benefits?
However, if you are receiving social security benefits, there may be what’s called an “offset” that will decrease the amount of either social security benefits or time loss payments you receive, depending on your age. If time loss or a pension reduces your federal benefit it can feel like a tax, even though technically it is not.
More questions? Seek Help With A Worker’s Comp Lawyer
If you have questions about time loss or wage replacement payments, or anything else on your worker’s compensation claim in Eastern Washington, give Carlisle & Byers a call – we’ll set up a time to talk.