Hello DavidD66!
Thank you for continuing to address this thread. I also receive LTD benefits from a third-party insurer reported on a W2 as third-party sick pay. I had been paying IL state taxes on my sick pay until 2024 when my insurer informed me that they had been erroneously been withholding and remitting taxes to IL (my state of residence) instead of TX (the state I worked in when I became disabled). They stopped withholding for IL and I was able to file amended returns to get back the last three years of taxes paid to IL. However, I'm struggling with how to file IL taxes going forward to indicate that the third-party sick pay should not be taxed. If I understand your previous answer my LTD insurer should leave box 16 blank. What language do I use to explain to them how and why they need to correct my W2?
