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We’re reviewing our medical evaluation process for assessing disability benefit applicants, and we would appreciate feedback from other jurisdictions regarding their practices. Does a third party manage the evaluation process or a panel of doctors? If a panel of doctors oversees the process, how many serve on your panel? What is your method of compensation (flat monthly amount, paid per case)?

I am confident that nonqualified top hat plans will need to address the final rule, specifically when disability is a payment trigger; however, is the rule applicable if disability only accelerates vesting and is not a payment trigger? Would seem so, but I'm not certain. What if the plan only contains disability respective to the cancellation of a deferral election? Would the rule apply here as well? Thoughts are greatly appreciated. Thanks!

Hello, Would a surviving spouse be eligible for the same tax exemption as the duty disability retiree? I see all kinds of documentation referring to federal tax exemption to the disability retiree but nothing referring me to how taxation works for the person picking up the pension after the death of the disability retiree. I was given a copy of PLR -167262-03 within it "...the benefits received by the surviving spouse or dependent minor children of a recipient who was receiving service incurred benefits are also excludable from gross income...." Thanks!

I am a caregiver for a 55-year-old woman disabled by mental illness since 2003. Her husband divorced her as soon as she became disabled, and she received alimony until he retired six months ago. She was independent for the first several years I was with her, but I lived in her home as a safety measure because she was heavily medicated at night to keep her from having hallucinations that caused her to sleepwalk and even drive. She handled her own finances and I knew little except that even with disability and alimony she struggled financially due to the cost of her medications and paying for my room and board, which was the payment for my help. After an accident in 2013 caused injuries to her brain and internal organs she became more dependent on me, and at the loss of driving privileges she became a recluse. As soon as she receives her portion of her husband's retirement plan through a QDRO, I will be helping her find a residential care facility, as I am nearly 70 years old and ready to go. I apologize for the background, but it is necessary to my question. She has recently told me in a rare lucid moment that she has not paid income taxes in eight years. I did not mention to her that the IRS could levy her QDRO before she even receives it. Am I right? I think she slipped under the radar since she has not received even a letter from them (I pick up our mail), Her distribution will be $100k so they might take notice now, I'm afraid. Thank you.

An employer has a group short-term disability plan that is set up to be partially paid by the employer with remaining premiums paid as pre-tax contributions from employees. However, because of a LOA due to injury that resulted in STD payments, an employee made ONLY post-tax contributions to the plan. The employer drafted the W-2 showing all STD benefits as taxable, with the reasoning that it is a pre-tax group plan, even though this particular employee made all contributions post-tax. The employer has offered to refund the premiums, but I'm not sure if this would abide by IRS regulation. Should the benefits be taxable or non-taxable in this unique situation?

If an employee becomes disabled but has not separated from service, is this a distributable event? In other words, does the "disabled" employee have to be terminated in order to receive a distribution from the plan? Other info: The employee is an owner/partner and has not severed his partnership with the plan sponsor. The plan is a 401k plan. The participant is already 100% vested. The participant does not meet the plan's in-service age requirement and already has an outstanding loan. The plan does not allow hardship withdrawals.

A participant in a 401(k) plan is receiving disability from his/her employer (paid for by his/her employer). Since this income is considered taxable, can a portion of these payments be contributed to the plan (assuming they do not violate the 415 limits) as employee deferrals?