Monthly LTD Payments
If you are totally disabled, each monthly payment will be 60% of your monthly base salary, up to a maximum monthly benefit amount of $14,500. This means the maximum covered salary is $24,166.67 per month (or $290,000 per year), since $24,166.67 times 60% equals $14,500.
If you are partially disabled, the amount of your monthly disability benefit will be adjusted, taking into consideration the amount of your earnings while partially disabled. The monthly benefit for partial disability is 75% of the difference between your full-time monthly base salary and your monthly base salary while you are partially disabled. For example, if your regular full-time monthly base salary is $1,000 and your salary while you are partially disabled is $650, you deduct $650 from $1,000 to get $350. Multiply $350 by 75% to get $262.50 which is the amount of your monthly disability benefit.
Your monthly disability payments from the plan will be reduced by any payments you receive from any of the following sources:
- Social Security (including any benefits for dependents) or similar government programs
- Workers’ Compensation or similar payments, except when they result from previous injuries or disabilities
- Any group disability benefits payable under any group insurance or retirement plan to which the University contributes
- Sick pay
The plan does, however, guarantee you a minimum benefit of $100 per month regardless of your income from other sources.
You are required to apply for Social Security Benefits should your disability be expected to extend for twelve months.
On July 1 following the first 12 months during which you have received disability payments, and each July 1 thereafter, the amount of your monthly disability income from this plan will be increased by 3%. These increases apply for the first 5 years of disability under this plan and then stop.
Tax on Your LTD Income
Under present federal income tax laws, your disability benefits are considered taxable income to you in the year they are received.