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Tax Planning/SSDI and Long Term Disability



Thank you so much for taking the time to answer my question.
In April of 2013 I had to stop working because of disability. I immediately applied for SSDI and LTD through my employer.

I was approved for LTD in October of 2013 with the help of an attorney. SSDI was approved back to October 2013 in July of 2015.

When I received the back pay from SSDI, I had to repay most of the benefits I received from LTD.

I normally do my own tax returns. My question is how do I handle the repayment to LTD and the legal fee on my 2015 tax return? Will I get tax forms from both SSDI and LTD that I can use?

Thank you again.

Debra - The benefits you received from the LTD from your employer were LIKELY not taxable, so returning them should not affect your taxes.  However, you will LIKELY get a tax form from Social Security for the benefits that were paid out to you in 2015 for all three years (13-15).  That form should be arriving shortly.  It will break down your social security benefits by year.  Receiving all of those benefits and reporting them in one year can make your SS benefits taxable or increase the amount that is subject to tax.  I suggest that you amend your prior year returns to reflect the receipt of those monies as outlined on the social security statement you receive (1099-SSA).

As to whether the attorney fees are deductible depends on whether or not you can itemize.  They are a miscellaneous deduction subject to a 2% AGI floor.  For more details on this, see -->

I hope this helps!

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As an Enrolled Agent, I am fully capable of providing tax advice as it relates to personal and business income taxes. Enrolled Agents are the only Federally licensed tax practitioners and are admitted to practice before all administrative functions of the IRS. My specialty is working with small business owners who file Schedule "C" and helping them to structure their business in such a way as to maximize as many tax advantages as possible. I also enjoy working with individuals who have both routine as well as complex tax situations. I prefer to concentrate on individuals and small business tax planning.


I have a 25 year background in financial services including tax, bookkeeping, insurance, real estate and securities. I was previously the Chief Financial Officer of a local and national franchise organization. I am currently semi-retired, but used to own (in partnership with another EA) an individual and small business financial engineering firm where I work with nearly 2,500 individuals and small business owners in nearly every state and almost every continent, assisting them in all aspects of their tax and financial well-being. I have prepared or reviewed more than 8,000 tax returns in my career.

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Enrolled Agent, Admitted to Practice Before the IRS, Accredited Tax Preparer, Fellow of National Tax Practice Institute, Certified QuickBooks ProAdvisor (1999-2011), Sleeter Group Certified QuickBooks Consultant, Life & Disability Insurance Agent License (California, Texas, Maine), Real Estate Agent License (California); Many years of continuing education in all these fields.

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