Are long-term disability benefits taxable in the US?
It depends on how premiums were paid. If your employer paid the premiums with pre-tax dollars (typical for group ERISA plans), your LTD benefits are taxable. If you paid the premiums yourself with after-tax dollars, the benefits are tax-free under IRC §104/105.
Does SSDI reduce my long-term disability benefit?
Usually yes. Most group (ERISA) LTD policies offset Social Security Disability Insurance (SSDI) dollar-for-dollar. Your policy typically requires you to apply for SSDI, and the insurer may estimate and deduct the SSDI amount even before you are approved.
What is the difference between an ERISA and non-ERISA LTD claim?
Employer-sponsored group LTD plans are governed by ERISA, a federal law that limits your remedies — no jury trial, no punitive damages, and the court often defers to the insurer's decision. Individual (privately purchased) policies are governed by state law, which allows bad-faith and punitive damages.
How long do LTD benefits last?
Most policies pay until age 65 or Social Security full retirement age, as long as you continue to meet the disability definition. After 24 months, most policies shift from an own-occupation to a stricter any-occupation standard.