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New Member
posted Jun 5, 2019 10:22:49 PM

My SSA-1099 has workers compensation offset on it. Workers compensation is non taxable. So where can I make a deduction for that on my tax's?

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New Member
Jun 5, 2019 10:22:50 PM

You do not get a deduction for the worker's compensation offset.

Enter on your income tax return:

  • The amount in the PINK box shows the reportable amount paid by SSA. Ignore everything else.
  • The IRS cross matches Box 5 on the SSA-1099 with your income tax return.

Per IRS Publication 525 Taxable and Nontaxable Income page 19 Workers' Compensation : 

  • If you receive both Social Security Disability and Workers Compensation Benefits: Social Security Benefits are taxable to a certain extent. 
  • If you receive both Social Security Disability Benefits and Workers Compensation, then Social Security may be reduced by a certain amount due to your receipt of Workers Compensation Benefits (you can only receive up to 80% of your pre-disability earnings form both sources, otherwise, Social Security reduces its benefits).
  • The IRS tax you on the FULL amount of the Social Security Benefit, even if it has been reduced by Workers Compensation.

Additional information:

Social Security How Workers' Compensation and Other Disability Payments May Affect Your Benefits