A very important part of making a living as a person with a disability is to understand the availability and the availability of your state's disability income programs.
About state disability income:
While having state disability income it could be reduced by having a higher income in the 3 preceding months, if your disability insurance coverage policy will last for a total of 6 months or less.
-No additional cost to the taxpayer.
-Allows the taxpayer to have disability income when they have prior years of employment.
-Should be considered on relocation.
Pros of state disability income:
Once you are approved for state disability income, you qualify to receive up to 100% of your average earnings for 2 years preceding the date you become disabled. Payment is added to disability income.
-Tax exempt.
-No Deductions.
-Ability to use social security retirement funds to pay the state disability payment.
-Individuals with moderate incomes are eligible.
Pros of state disability income:
State disability income retirement benefits are generally taxable at 100 percent of the state's rate. There are certain amounts that qualify as disabled retirement benefits, & are taxed at 5 percent.
Cons of state disability income:
-You can have only a couple of sources of income & use this disability income as your primary form of income, which means would only be limited by personal exemption.
In state disability income minimum amount of taxable income that a person is required to report on his income tax return is generally determined by the total amount of "extraordinary income" for year.