What is the Application Process for Social Security Disability and SSI?
How do you Win Benefits under Social Security Disability or SSI?
If I am determined disabled, how far back will Social Security pay benefits?
How do you prove your disability case if you have a mental condition?
What Can I Do to Improve My Chances of Winning Disability Benefits
Common Mistakes after Receiving a Denial of Social Security Disability or SSI Benefits
How to File for Disability - Tips for Filing
If You Get Approved For SSDI Will You Also Get Medicare?
How much does a Social Security disability attorney get paid?
Social Security Disability SSI Criteria and the Evaluation Process
How long does it take to be approved for SSI or Social Security disability?
What do you Need to Prove to Qualify for Disability Benefits?
Social Security Disability SSI and Fibromyalgia
Social Security Disability SSI and Degenerative Disc Disease
Can I Qualify For Disability and Receive Benefits based on Depression?
Answers to questions about SSD and SSI disability
What Disabilities Qualify for SSI and Social Security Disability Benefits?
Social Security Disability Status
Social Security Disability Tips — how a claim gets worked on
Social Security Disability, SSI Disability - Terms, Definitions, Concepts
Are Social Security Disability Benefits Taxable?
How to prove you are disabled
and win disability benefits
The simple answer to this is that Social Security disability benefits are taxable. However, you "may or may not" have to pay tax on your disability benefits. Social Security issues a miscellaneous SSA 1099 for disability benefits paid each year.
The two potential types of Social Security disability benefits that are taxable are: A) Monthly disability benefit payments and B) Lump-sum back payments of disability benefits. How much of your disability benefits will be taxable depends on the total amount of your Social Security disability benefits and any other income. Currently, your Social Security disability benefits may be taxable if your total income exceeds $25000.00 as an individual, or $32000.00 for a couple.
Lump sum payments of retroactive disability benefits can be a little more tricky since they often involve payment for years prior to the year you receive your SSA 1099. Conventional wisdom seems to indicate that it is easier to just claim all the lump sum back payment in the year that you receive the payment rather than filing amended returns for any previous years. The IRS publication 915 deals with Social Security benefit taxation and provides useful worksheets to help you figure out if your Social Security disability benefits are taxable.
There are also some potential deductions and credits for disability claimants who received a lump sum retroactive back payment of benefits. You may be able to deduct expenses that you paid to get your retroactive disability benefits. If you had a representative or attorney, you may be able to deduct their fee from the taxable part of your SSDI benefits. If you had to repay your employer’s or your long-term disability insurance company out of your back payment, you may be able to deduct the amount you had to repay. These deductions can be complicated to figure out so it is advisable to obtain the services of a tax professional to help you calculate your deductions.
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Topics and Questions
SSD and SSI are Federal Programs
The title II Social Security Disability and title 16 SSI Disability programs operate under federal guidelines and, therefore, the program requirements--medical and non-medical--apply to all states:
Alabama, Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Florida, Georgia, Hawaii, Idaho, Indiana, Illinois, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin, Wyoming
Recent approval and denial statistics for various states can be viewed here:
Social Security Disability, SSI Approval and Denial Statistics by state
Special Section: Disability Lawyers and unnecessary claim denials