Is Short-term Disability (STD) considered taxable income?

What if the STD premiums were split between me and my employer? I pay like 40% and they cover the rest. How would the taxes work in that situation?

If the premiums were split between you and your employer, then a corresponding percentage of the benefits would be taxable. So in your example where you paid 40% of the premiums with after-tax dollars, approximately 40% of your STD benefits would be non-taxable, and the 60% that your employer paid would be taxable income. You should check with your HR department to confirm exactly how your specific plan is set up. They can tell you both how the premiums were paid and how the income will be reported to you for tax purposes.

Did it actually work? I've tried so many "tax help" websites that just waste my time and then try to upsell me on expensive packages. How detailed was the information you got?

Does it work for all types of disability income? I'm getting both short-term disability from my employer's plan AND some state disability benefits. Would this help figure out both?

It actually did work, and I was surprised because I'm usually skeptical of these things too. The analysis was pretty detailed - it broke down exactly which portions of my payments were taxable versus non-taxable based on my premium contribution structure. It was way more specific than the generic advice I was getting elsewhere. Yes, it handles different types of disability income. My situation included both company STD and some supplemental coverage I had, and it separated everything correctly. It should definitely work for your situation with the mix of employer STD and state benefits, which can be especially confusing tax-wise.

How does this actually work? Are they somehow gaming the IRS phone system? Seems sketchy to me that they could get you through when the regular phone line keeps everyone on hold forever.

Yeah right. There's no way this actually works. The IRS phone system is completely broken - I've called 30+ times this year and either get disconnected or told the wait is too long. No way some service magically fixes that.

It's not gaming the system - they use a combination of automated calling technology and timing analysis. The service continually calls and navigates the IRS phone tree until it secures a place in line, then it calls you to connect. It's basically doing what you'd do manually but with technology that can keep trying efficiently. I was super skeptical too! I had tried calling 8 different times and couldn't get anywhere. But this actually worked - and the IRS agent I spoke with answered my specific question about how to report STD when it doesn't show on any standard tax forms. Seriously worth it for complicated tax situations where you need to actually talk to someone.

That's a really good point I hadn't considered. I think my company might have done something similar for the first week before the STD kicked in. How would I be able to tell the difference between the regular STD payment and the portion that came from my PTO?

You should be able to see it on your pay stubs from that period. Look for separate line items - there might be one for regular salary/PTO and another specifically labeled as disability or STD benefits. The best approach is to request a detailed breakdown from your payroll department. They can provide documentation showing exactly which payments came from which sources. This is important because they're potentially taxed differently. Your HR/Benefits team should also have documentation about how your specific STD plan integrates with your other paid leave benefits.

Is there a website or resource that breaks down the state-by-state rules for disability taxation? I'm in Pennsylvania and can't find clear info for my state.