Brad was disabled for part of the year,and he received $11,500 of benefits from a disability insurance policy purchased by his employer.Brad must include all $11,500 of benefits in his gross income because he was not taxed on the disability insurance premiums paid by his employer.

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According to IRS rules, if an employer pays the premiums on a disability insurance policy, then any benefits received from that policy are taxable income to the employee. Therefore, Brad must include all $11,500 of benefits in his gross income.

Brad Was Disabled for Part of the Year,and He Received