Some answers can be found at Allsup.com, however. Allsup has provided Social Security disability claims assistance since 1984, the first company in the country to do so.
A press release from Allsup outlines some of the details.
—Up to half of your SSDI benefits are taxable. Take half of those benefits and add them to all of your other income. If that comes to $32,000 for couples or $25,000 for an individual for the year 2010, you’ll likely owe taxes. But the average SSDI recipient has a far lower total income. File a tax return anyway, as you could be due a refund for certain credits.
—If you received a lump-sum SSDI benefit and file using that whole amount, you’ll likely pay tax, as it makes your income look bigger. Instead, spread that amount out over the years. The Internal Revenue Service allows you to do that, but don’t take a chance by doing this yourself. Get tax help.
—Workman’s compensation usually isn’t taxable, and neither are long-term disability benefits IF you paid for them with after-tax dollars. If your employer paid the premiums, it counts as income. Again, get assistance.
—You may be eligible for the Earned Income Tax Credit if you earned between $13,460 and $48,362, but it depends on your individual situation, such as filing status and the number of dependents you claim. Other possible credits include those for the disabled and for dependent care.
Besides the credits, there are numerous possible deductions you can take, such as a higher standard deduction if you are blind or visually impaired, medical deductions above 7.5 percent of your adjusted gross income, and the cost of seeking help to get SSDI benefits.
For more information, go to Allsup’s website: www.allsupinc.com. Click the link to Consumer Web Site in the upper right corner. Click on Personal Finance, then click Managing Your Taxes, a free online guide. Or call them at 800-279-4357. There is a fee for its services.
David Uffington regrets that he cannot personally answer reader questions, but will incorporate them into his column whenever possible. Write to him in care of King Features Weekly Service, P.O. Box 536475, Orlando, FL 32853-6475, or send e-mail to email@example.com.
(c) 2011 King Features Synd., Inc.