Workers’ compensation benefits are generally not taxable at the federal or state level, but there are exceptions when receiving Social Security Disability Insurance (SSDI) or Supplemental Security Income (SSI).
Workers' compensation insurance, often mandated by state law, covers work-related accidents, illnesses, lost wages, ongoing care, disability benefits, and funeral costs.
Employees receiving both workers’ compensation and Social Security Disability Insurance (SSDI) or Supplemental Security Income (SSI) may need to pay taxes on a portion of their benefits, especially with permanent injuries.
Each state has unique workers’ compensation requirements, so employees should research their state’s laws to understand tax implications.
Businesses can deduct workers' compensation premiums and benefits on taxes, while employees cannot deduct workers' compensation benefits on their returns.
Get the right coverage and understand your tax obligations with workers' compensation insurance. Contact us today for a personalized quote and protect your business and employees effectively.