Both before my long-term disability began and recently, my company advised that any benefits paid out are considered non-taxable. I originally asked given no taxes were deducted from my benefits. However, I began completing my taxes on TurboTax yesterday and was unpleasantly surprised with a substantial liability for both federal and state. I followed up with my company again this morning and was told again that benefits are indeed not taxable given I paid premiums with after-tax funds. Would my LTD benefits really be considered not taxable? If this is accurate, somehow TurboTax Deluxe is not recognizing this. Am I supposed to simply exclude the related W-2 and view it simply as records? Shouldn’t Deluxe recognize this based on LTD W-2 entries?
