Is STD (Short-Term Disability) taxable income for 2025 filing?
I'm getting totally mixed info on this and it's stressing me out. Started medical leave last month and now getting STD payments from my company's insurance. Some people are saying I need to pay taxes on this, others say it's not taxable at all. If it is taxable, would it come as a W-2 at the end of the year? Or some other form? I've never been on disability before and trying to plan ahead for tax season. Thanks for any clear answers!
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Madison King
Whether your Short-Term Disability (STD) payments are taxable depends on who paid the premiums. If your employer paid the premiums for your STD insurance with pre-tax dollars, then yes, your benefits are taxable income. If you paid the premiums yourself with after-tax dollars, then your benefits are tax-free. As for tax forms, your STD payments won't come on a W-2 unless they're coming directly from your employer as part of a self-insured plan. Most commonly, they'll be reported on a 1099-NEC or sometimes a 1099-MISC from the insurance company. Some companies might include it in Box 12 of your W-2 with a specific code.
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Julian Paolo
•But what if my employer pays part of the premium and I pay part? Is just the percentage my employer pays taxable? And what about if I can't remember if it was pre-tax or after-tax from my paycheck?
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Madison King
•If your employer pays part and you pay part, it gets a bit more complicated. The benefits are typically taxable in proportion to how the premiums were paid. So if your employer paid 70% of the premiums with pre-tax dollars, then approximately 70% of your benefits would be taxable. For determining whether your contributions were pre-tax or after-tax, check your paystubs. Pre-tax contributions would have reduced your taxable wages reported in Box 1 of your W-2. Your HR department can also tell you how your specific plan is structured if you're unsure.
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Ella Knight
I went through this exact situation last year and was so confused until I found taxr.ai (https://taxr.ai). When I uploaded my STD statements and benefit documents, it analyzed everything and told me exactly what portion was taxable and what forms to expect. Saved me so much stress and guessing - especially since my situation was complicated with both employer and personal premium contributions.
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William Schwarz
•Did it actually help figure out if your contributions were pre-tax or post-tax? My HR is completely useless and I can't get a straight answer from them.
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Lauren Johnson
•How long did the analysis take? I've tried other tax sites that claimed to answer these questions but they just gave generic info I could find on Google.
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Ella Knight
•Yes, it determined that my contributions were made pre-tax through my company's cafeteria plan, which meant all my STD benefits were fully taxable. It showed me exactly where to look on my paystubs for the evidence too - something I completely missed. The analysis took about 5 minutes total. It's not like those generic sites at all - it actually looks at your specific documents and gives personalized answers based on your situation, not just general information that applies to everyone.
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William Schwarz
Just wanted to update - I tried taxr.ai after seeing the recommendation here and it was super helpful! Uploaded my benefit election forms and recent STD statement and it confirmed my payments are partially taxable (60% taxable since my employer paid that portion of premiums). It even estimated how much I should set aside for taxes since there's no withholding on my payments. Definitely recommend if you're confused about your situation!
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Jade Santiago
If you're getting nowhere with figuring this out, call the IRS directly. I know it sounds awful, but I used Claimyr (https://claimyr.com) to get through to an agent in about 10 minutes instead of waiting on hold for hours. They have this callback system that works surprisingly well (see how it works: https://youtu.be/_kiP6q8DX5c). The agent I talked to explained exactly how my STD payments should be reported and what forms to expect.
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Caleb Stone
•Does this actually work? I've literally never been able to get through to a real person at the IRS. Spent like 2 hours on hold last time before giving up.
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Daniel Price
•Sounds like a scam tbh. Why would you pay some random service when you can just call the IRS yourself? They're probably just using automated dialers which the IRS specifically tries to block.
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Jade Santiago
•Yes, it absolutely works. I was connected to a real IRS agent who answered all my questions about how STD benefits are taxed based on premium payment sources. No automated system has ever gotten me through before. It's definitely not a scam. They don't handle any of your personal tax info - they just connect you to the IRS faster than you could get through on your own. It's basically a sophisticated hold system that waits in the queue for you instead of you having to stay on the phone yourself for hours.
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Daniel Price
Ok I was totally wrong about Claimyr. I tried it yesterday after my last failed 90-minute attempt to reach the IRS. Got connected to an agent in 15 minutes who confirmed my specific STD situation (where I paid premiums with after-tax dollars) means my benefits are non-taxable. She even emailed me the specific IRS publication that confirms this. Worth every penny for getting a definitive answer from the actual source instead of random internet advice!
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Olivia Evans
Don't forget to check if they're withholding taxes from your STD payments too! Mine didn't withhold anything and I got hit with a surprise tax bill. You can submit a W-4V form to request voluntary withholding if they're not already doing it.
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Vanessa Chang
•Wait that's a great point I didn't even think about! I just checked my STD payments and they're not withholding anything. How much should I request they withhold? And where do I get that W-4V form?
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Olivia Evans
•For federal taxes, the W-4V form lets you choose to withhold 7%, 10%, 12%, or 22% of each payment. Most people choose 10% as a starting point, but it depends on your overall tax situation and what tax bracket you're in. You can download the W-4V form directly from the IRS website (just search "Form W-4V PDF") or ask your STD administrator for one. Submit it to whoever is paying your benefits, not to the IRS. Don't forget about state taxes too - you might need to make quarterly estimated tax payments for those if your state has income tax.
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Sophia Bennett
Another thing nobody mentioned is if your STD is part of a state program (like in CA, NY, NJ, RI) - those are usually taxable federally but might be exempt from state taxes.
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Aiden Chen
•Yes! I'm in California and my SDI payments were federally taxable but exempt from CA state tax. Makes a huge difference when filing.
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Vanessa Chang
•I'm in Illinois - we don't have a state disability program as far as I know, just the company plan. But good to know about the state differences if I ever move!
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Lincoln Ramiro
Just went through this myself - definitely check your paystub to see if your STD premiums were deducted pre-tax or after-tax. If you can't tell from your paystub, look at your annual benefits enrollment materials or contact your benefits administrator directly. They should be able to tell you exactly how your premiums are structured. Also, keep all your STD payment statements organized - you'll need them for tax time regardless of whether they're taxable or not. The insurance company should send you the appropriate tax forms (1099-MISC or similar) by January 31st if the payments are taxable.
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