August 29, 2008, Newsletter Issue #25: Disability Income Insurance Programs Offered by the Federal Government

Tip of the Week

All federal disability insurance plans are not simply government Social Security disability programs. There are actually six entities offering disability income insurance that are classified as government programs.

Social Security Disability Insurance (SSDI). This is the most popular and recognizable program and is often not subject to disability insurance income tax. Taxability normally results from your level of other earnings during your disability benefit period. Medicare Benefits. If disabled, you may be eligible to enroll in the Medicare program. Workers Compensation. This program helps protect your income should you become disabled while performing the duties of your job. Veterans Benefits. Formerly called the Veterans Administration (VA), disability benefits you receive from the Department of Veterans Affairs are often not taxed. Military Benefits. Military disability pensions are often taxable. However, if you suffered your disability while in active service, you may receive an exclusion. Federal Employees Retirement System (FERS). Federal employees enrolled in the system can become eligible for employee disability benefits, but most insurance benefits are often taxable until you reach a specified age. As with many other government programs, federal disability insurance have a number of requirements and conditions. To learn about disability benefit levels and qualification regulations, perform your own research to get a knowledge base that may help you should you need benefits in the future.

Refer to your insurance policy contract for specific information regarding your coverage and for actual terms, conditions and exclusions. The above statements are general in nature and may or may not reflect the actual terms of your insurance policy.

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