Ask Experts Questions for FREE Help!
 
Free Answers in 3 Easy Steps

Register Now		 3 Steps
 
Ask QuestionsprogressAnswer QuestionsprogressBuild ReputationprogressBecome an Expert
 
At Ask Me Help Desk you can ask questions in any topic and have them answered for free by our experts. To ask questions or participate in answering them you must register for a free account. By registering you will be able to:
  • Get free answers from experts in any of our 300+ topics.
  • Accept money for answers that you provide.
  • Communicate privately with other members (PM).
  • See fewer ads.
  Answer this Question    Ask about Taxes    Ask about another Subject  
 
PDA

elmos4me3
Nov 8, 2007, 03:52 PM
I recieved a lump sum back payment for disability and I am wondering if it's taxable and if so why doesn't the government take the taxes before they distribute it? I honestly can't think of another situation where they fail to immediately take their share .
AtlantaTaxExpert
Nov 9, 2007, 12:10 PM
If the disability is from a private company to whom YOU paid disability insurance premiums, then the lump sum is TOTALLY TAX FREE, which is why no income taxes were withheld.

If the lump sum is from Social Security Disability, part of it is tax-exempt, but part is probably taxable. It depends on your specific situation and the amount of the payment and requires a somewhat complex tax calculation.