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Long Term Disability

What Do I Need to Know to Enroll?

Decide which LTD tax option you want.

Enter your choice in MyVeritasBenefits during your benefits enrollment event.

During New Hire or Open Enrollment, you have two Long Term Disability election options:

Option 1
Long-Term Disability Plan 60 Option -- Veritas pays the monthly premium on your behalf. You pay nothing now out of your pocket, but in the event you are disabled and eligible for LTD benefits, normal taxes would be deducted from any monthly disability payments you receive.

Net effect: You would receive a substantially smaller monthly benefit.

Option 2
Long-Term Disability Plan 60 After-Tax Option -- Veritas pays the monthly premium on your behalf. You pay tax on the value of the coverage each pay period, but in the event you are disabled and eligible for LTD benefits, your monthly disability payment would not be taxed.

Net effect: You would receive the full monthly benefit.

The chart below shows the monthly costs and benefits for an employee earning a salary of $112,000.00, in the 28% tax bracket and illustrates the impact of both of the LTD options.

  While working: If disabled and eligible for LTD benefits:
Plan Option Employee's monthly deduction Employee's gross monthly benefit Taxes deducted from Employees LTD benefit Employee's net monthly benefit
LTD Plan 60
(Option 1)
$0.00 $5,600 $1,568 $4,032
LTD Plan 60
After-Tax

(Option 2)
$28.22 $5,600 $0 $5,600

Deciding which option to elect is a personal choice and it really comes down to whether you wish to pay taxes on your LTD benefits now or potentially later. It's very important that you make the right decision because you cannot change your option mid-year.

Paying for LTD coverage with after-tax dollars now means more money at a time when you'll need it most. Remember, your benefit amount will be offset by any other disability income you may receive, such as Social Security (for you or your dependent family members), state disability, or workers' compensation pay, regardless of the taxability of the other benefits you receive.

Leaving the Company

Eligibility for new Long Term Disability insurance coverage ends on your date of termination. You have the option to convert your existing coverage.

  • Conversion Instructions (doc)
  • Conversion Form (pdf)
 
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