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Is state disability income taxable?

Is State Disability Income TaxableIf you are collecting state disability income, then you will be glad to know that this is not a taxable income by either federal or local taxes.

There is one exception, however, and that is if you became disabled while collecting unemployment insurance and are moved to the state disability plan.

In this case, because it is replacing unemployment payments, which are taxable, your state will charge you taxes for your disability income.

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Much like unemployment, however, you can determine the percentage amount that is taken from your weekly or monthly deposit. If you are tax exempt and you are sure you are tax exempt, then you can simply ask for 0% to be taken from your check.

If your state has state taxes, then you should have them take out at least 3%, even if you are tax exempt, to prevent owing state taxes at the end of the year.

What is state disability; I’ve never heard of it?

If you haven’t heard of state disability, then it is probable that you don’t live in one of the five states that offer this benefit. The states that currently offer a government funded disability program are:

  • California
  • Hawaii
  • New Jersey
  • New York
  • Rhode Island

Each of these states offers something a little different in terms of their disability programs. In every case, however, the disability insurance is only meant to be short-term insurance. In addition, your disability cannot be work related. If you were injured on the job, your employer will be required to pay for your disability through workmen’s compensation insurance, which employers are required to carry by law.

State disability insurance may cover you if you’ve recently had a baby and you are on maternity leave or if there were complications from the birth and you will be out of work for more than 9 weeks but less than 6 months. In addition, if you have an unexpected illness, an auto accident, etc. then you may also qualify for coverage.

This is not a comprehensive list of what your state disability plan might cover. This is only to give you an idea of what type of situation might qualify you for this benefit.

What if my state doesn’t offer disability?

If you don’t have private disability insurance and you don’t live in a state that provides state disability, then you may have a problem, especially if your disability isn’t expected to last more than a couple of months. You see, you won’t be able to purchase disability insurance once you are disabled and in order to qualify for the federal governments disability benefits, you are going to have to meet some very specific criteria.

First of all, in order to qualify for Social Security Disability Insurance (SSDI), you are going to have to have a solid work history during which you have accrued federal work credit for this benefit. For many people, this is the part that proves to be the easiest to qualify for. It is the rest of the criteria that many people find frustrating when they apply for SSDI.

When you apply for SSDI, you are going to have to provide comprehensive documents proving that you are disabled. No, they aren’t going to take your word for it and a note from your doctor won’t do. You are going to have to provide them with all of your medical details, your medical file, your doctor’s notes and so on.

That’s not all either. Once you have provided the Social Security division with this information, they are going to send someone to your home to assess your situation. They will determine whether or not a change of occupations will allow you to work. If they determine that you can work outside of your current occupation, you will be turned down for benefits.

In addition to all of this, you will have to prove that your disability is a long-term disability. In many cases, you cannot qualify for SSDI unless you have been disabled for more than a year. Imagine being without income for this amount of time. There are some exceptions to this rule, however. For example, if a person becomes a quadriplegic after an accident, then it is a given that you will be disabled for more than a year.

If you do qualify for SSDI, you will have to recertify every year. It is very important that you keep all of your medical records, obey all of your doctor’s recommendations for your care and keep all of your appointments. If the government feels like you aren’t contributing to your recovery, then you may find yourself without the benefits that you need.

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What do I do if I don’t qualify for SSDI?

If you don’t qualify for SSDI then you may be out of luck when it comes to getting disability benefits. This, however, doesn’t mean that you don’t have any options at all. If you can’t get disability benefits, then it is time to take advantage of some of the other state programs that your state has to offer.

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First of all, there are food stamps or, as they are called today, SNAP (Supplemental Nutrition Assistance Program). SNAP isn’t something that you can afford to ignore or something that is beneath you. These are exactly the type of situations for which SNAP was designed and it is important that you take advantage of every program that is available.

In addition to SNAP, you should also apply for any financial assistance programs, seek out help from local churches and consider other alternatives such as renting out a room in your home, taking in a roommate, or even a career change. If your disability doesn’t prevent you from typing or working a register, etc. then consider something outside of your former career path.

The bottom line is that you shouldn’t lose hope. It is important that you don’t let pride get in the way and prevent you from asking for help. This could lead to an even more difficult situation. Instead, use the resources that are available to you no matter what they are.

If you aren’t disabled and you don’t have disability insurance, then it is time for you to purchase some. Disability insurance is protection against the unforeseen. You don’t know when something might happen that prevents you from being able to work. If you depend on your income to pay the bills, then you need to protect your ability to receive that income and you do that with disability insurance.

There are two different disability insurance options for you to consider, long-term and short-term disability. Often they are sold as a package deal, but you can also choose not to have one or the other if you find that the premiums are too high. The chances are higher that an illness or an accident will keep you out of work for a shorter period of time, so if you have to choose between them, start with short-term insurance. Whenever possible, however, you need to have both types of coverage.

Disability insurance doesn’t have to be expensive, but if you think that you can’t afford it then you can purchase a smaller benefit amount. Make sure, however, that your benefit will still pay the bills should the worst happen. In addition, policies with a lifetime cap are less expensive than those that don’t cap out, so you may want to consider that as well.

Regardless, before you make any decision, you need to start by using our free quote tool so that you can see just how much disability insurance will cost you. It doesn’t take more than ten minutes to answer the questions and once you are done you will instantly receive several quotes from some great companies.

Take your first step to financial protection by using the free disability insurance quotes tool now!

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