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I didn't know this!!!

Posted by dstephans on Apr. 1, 2015  /  Subscribe 0

I was looking at the Circular E and found this little paragraph. From the Circular E: No federal income tax withholding on disability payments for injuries incurred as a direct result of a terrorist attack directed against the United States. Disability payments for injuries incurred as a direct result of a terrorist attack directed against the United States (or its al-lies) are not included in income. Because federal income tax withholding is only required when a payment is includable in income, no federal income tax should be withheld from these payments.

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