Question

A taxpayer must include in his or her income sick pay benefits received from all of the following payers except,

A. welfare fund

B. A state sickness or disability fund

C. An association of employers or employees

D. And insurance company, if the taxpayer paid the premiums on the accident or health insurance policy

Answer 1

Answer: option D

Explanation:

The general rule says that employees who are eligible for sick pay gets their benefits directly from employers, then sick pay is generally included in your federal taxable income.

Amount received for personal injury or sickness through an accident or health insurance policy are taxable if the employer has paid for the policy.

If the taxpayer himself paid the premium on the accidents or health insurance policy, then such benefit received are not included in his or her income.

SUMMARY

A Tax payer must include in his or her income sick pay benefit received except an insurance company if the taxpayer paid the premium on the accident or health insurance policy.