Proceeds from an accident and health policy such as Colonial Life or AFLAC :
1. If you pay the entire cost of
a sickness or injury plan with after-tax money, you do not need
to report any payments you receive under the plan as income.
2. If your employer pays half the
cost of premiums and does not deduct these payments from your pay, then you
most likely must report half the payments received as income.
3. Reimbursement of medical costs you’ve
paid for after the plan was established are not taxable, but may reduce the
amount of your medical costs deduction.
See the following TurboTax article for
additional information: Are Short Term Disability Claim
Payments ... - TurboTax - Intuit
