Get Informed About Disability Tax Credits

If you are receiving Social Security Disability insurance (SSDI) benefits, is it taxable?  The short answer is, yes. The Internal Revenue Service (IRS) counts disability benefits as income, unless it is a Supplemental Insurance Income (SSI) benefit.

You owe taxes on any amount above the base amount of your filing status. If you’re single, your base amount is $25,000. If you’re married and preparing a joint return, the amount is $32,000.

You have to add up one-half of your disability benefits and any other income you may have to determine how much is taxed.
There are other tax credits you can factor into your tax return if you are on disability. I have found a helpful publication on the IRS Web site that details a lot of information you should know.

What you want to read is Publication 907 (2008) Tax Highlights for Persons with Disabilities. You can click the title to “quick-link” right to it. Or, find it at www.irs.gov.  Here’s how I found it:

• On the IRS home page, click the top left header “Forms and Publications.”
• Click on “Tax publications” in the “View online” category.
• You’ll see a long list of publications organized in numerical order.  Scroll down until you find it.
• You have the option to read the entire publication online (click “html”) or download it and print it (click “pdf”).
• When you’re reading it online scroll down to the bottom of the page and click “next” to advance from the introductory page to the main content.

I hope you find this information useful.