Believe it or not, it is getting close to tax season yet again. For most people, getting their taxes filled out and filed might come with a big tax refund. For others, the news might not be as good. The one thing we all have in common in America is that we all, for the most part, have to go through this annual routine. However, those who receive Social Security Disability benefits may be thinking, are SSD benefits taxable?
The answer to this question, like the answer to so many other questions regarding Social Security Disability, is “it depends.” As a recent article noted, SSD benefits are, usually, considered to be tax-free benefits. However, there are situations in which a Los Angeles resident who receives SSD benefits may need to calculate their taxes differently.
For instance, many people qualify for SSD benefits but still receive income from other sources, like investments or rental property that they own. SSD benefits are not a need-based federal benefit – it doesn’t matter how much income you earn. If you qualify medically and have enough work credits, you can receive SSD benefits. This is different from Supplemental Security Income, which is, in part, based on a person’s financial resources.
So, while SSD benefits generally aren’t taxable, that doesn’t mean that a Los Angeles resident who receives these benefits doesn’t have to go through the annual routine of doing their taxes. If they do have income from other sources, those individuals will probably still need to file their taxes annually.
Source: wfmynews2.com, “Taxation of Social Security and SSDI Payments,” Feb. 17, 2017