Gail in Virginia Posted March 21, 2011 Report Share Posted March 21, 2011 Client is an employee for railroad. He received a payment from United Transportation Union Discipline Income Protection Program. This program provides a set amount of pay while an employee is unable to work because of certain disciplinary charges. This is an optional coverage that the employee pays for. The payment is reported on 1099MISC in box 3, and a letter came with the payment explaining that it is not subject to self-employment tax and that payment should be reported on line 21 as other income. However, there is also a letter that gives the amount he has paid each year for this coverage. The letter also states that in furnishing this information they have no knowledge as ti whether or not he may have utilized any portion of the total amount. Even though the letter talking about taxes does not mention excluding this income, I am wondering if he can exclude it to the extent of his cost of the premiums. Any one have any experience with this, or opinions? Quote Link to comment Share on other sites More sharing options...
Pacun Posted March 21, 2011 Report Share Posted March 21, 2011 Client is an employee for railroad. He received a payment from United Transportation Union Discipline Income Protection Program. This program provides a set amount of pay while an employee is unable to work because of certain disciplinary charges. This is an optional coverage that they employee pays for. The payment is reported on 1099MISC in box 3, and a letter came with the payment explaining that it is not subject to self-employment tax and that payment should be reported on line 21 as other income. However, there is also a letter that gives the amount he has paid each year for this coverage. The letter also states that in furnishing this information they have no knowledge as ti whether or not he may have utilized any portion of the total amount. Even though the letter talking about taxes does not mention excluding this income, I am wondering if he can exclude it to the extent of his cost of the premiums. Any one have any experience with this, or opinions? Did employer pay a portion of the premiums? Were premiums paid pre tax or after tax? Quote Link to comment Share on other sites More sharing options...
Gail in Virginia Posted March 21, 2011 Author Report Share Posted March 21, 2011 Did employer pay a portion of the premiums? Were premiums paid pre tax or after tax? As I said, "This is an optional coverage that the employee pays for." The premiums were paid with after-tax dollars. Quote Link to comment Share on other sites More sharing options...
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