Originally Posted by
Jetjok
Underdog is correct in that if you are paying for your own LTD policy, when you start to receive benefits from it, generally you are not taxed. However, if you don't pay the premiums, as with the FedEx LTD plan, tax will be taken out of your benefit check each month.
Of course, the main difference between the FedEx LTD policy and the ALPA loss of license (LOL) policy is that the ALPA policy pays for up to a finite 48 months, while the FedEx policy can pay for years and years, depending on when one goes on LTD.
This from the ALPA web site: "This Loss of License coverage pays monthly benefits for loss of license due to covered physical or mental disabilities. Benefits commence 12 months after the date of disability and continue during disability for up to 48 months."
I don't believe the ALPA disability plan has a four year limit. I'm not sure about the loss of license.
You pay a set percentage of your check with the ALPA disability coverage. You have 2 options, collect one or two years after you are disabled. Obviously, the 1 year option is more expensive.
The ALPA plan is not taxed. They pay a flat 17% based on your highest consecutive 12 months in the past 3 years. Unlike the company plan, there is no cap at $260,000. So if your high 12 months was $400,000, you'd take in a tax free $68,000/year.
That's how it was explained to me. That sound right??