All Full Time, Non-Affiliated, SRS associates are eligible for long-term disability benefits. If you are rendered disabled by a licensed physician, for 180 days or more, you can apply and be considered for the LTD benefit. If approved, you would be eligible to receive 60% of your monthly earnings subject to any applicable maximum per month as stated in the policy. Associates are provided with two LTD tax options: Option 1 is on a company paid basis and Option 2 is on an employee paid, weekly post-tax deduction basis. Option 1 – Company Paid. If you become disabled, any disability benefit paid to you would be subject to Federal taxes. If the benefit paid is 60% of your pre-disability wages, and you are in the 21% tax bracket, your net benefit check would be about 48% of your normal gross wages.
Option 2 – Employee Paid/Weekly Contribution. If you pay the LTD premium with after-tax dollars, and you become disabled, the benefit of 60% (of your pre-disability wages) is NOT subject to Federal Tax. Therefore, you would receive the full 60% benefit. During the annual Open Enrollment period, you have the opportunity to review your current participation in the long-term disability program and can make changes to your current LTD tax election. To determine if you are already contributing directly for this benefit, check your most recent paystub. If you are contributing directly, there will be a deduction listed on your paystub as “LTD”. If you do not see a deduction on your paystub, you are enrolled as Company Paid (non-contributory). Note: LTD contributory plans are governed by IRS regulations. The IRS has a three-year “look back” on LTD plans. If you contribute from the inception of the policy and continue to contribute throughout the policy years, any benefit paid to you will not be subject to Federal Tax. If, however, you change your mind during the policy period, you will have to pay the premium for 3 full years before the benefit is not subject to tax. If you pay the premium for 1 or 2 years in the 3 year period, the taxable portion is prorated accordingly. Want to Make a Change? If you would like to change the way you receive your benefit download the below enrollment form. If there are no changes in the way LTD is offered to you, NO FORM is necessary.
Summary Plan Descriptions
