When I left my company earlier this year, I used my eligibility for LTD (Long Term Disability
) to transition into retirement. I went through a short period of collecting STD (Short Term Eligibility
), but, now that I am on LTD (Long Term Disability
) for the foreseeable future, the payments are much larger, and I am concerned whether or not the payments will be "taxable" at the end of the year.
Does anyone have any experience or insight into ......
- how Long Term Disability (LTD) payments are handled for tax purposes at the end of the year?
- Are they "reportable" on my 1040?
- Will the whole payment that I receive each month be taxable and count
towards my MAGI?
The answer to these questions, I believe will be hugely important as I plan for using the ACA for Health Insurance going forward. Currently, I am on Cobra, but, that will be "gone" next year, and as I think about my options, this problem of not really knowing what my MAGI will be next year and into the future is perplexing me.
Any help and/or advice would be greatly appreciated. Thanks!