Taxable Benefit or Not?

Wanting to find out which benefits are taxable and which are not? Need clarity on which benefits are taxable when paid out. The following article summarizes this information.

Life Insurance
• Any premium paid by the Employer must be treated as a taxable benefit to the Employee
• Any benefit paid upon the death of the Employee is non-taxable, regardless of who pays the premium

AD&D Insurance
• Any premium paid by the Employer is not a taxable benefit to the Employee
• Any benefit paid is not taxable, regardless of who pays the premium

Dependent Life Insurance
• Any premium paid by the Employer must be treated as a taxable benefit to the Employee
• Any benefit paid upon the death of the Dependent is non-taxable, regardless of who pays the premium

Short Term Disability
• Any premium paid by the Employer is not a taxable benefit to the Employee
• For a 100% non-taxable benefit, the Employee must contribute 100% of the premium. If the Employee contributes less than 100%, the benefit is taxable to the extent that the coverage is Employer paid.

Long Term Disability
• Any premium paid by the Employer is not a taxable benefit to the Employee
• For a 100% non-taxable benefit, the Employee must contribute 100% of the premium. If the Employee contributes less than 100%, the benefit is taxable to the extent that the coverage is Employer paid.

Extended Health Benefits
• Any premium paid by the Employer is not a taxable benefit to the Employee
• Any benefit paid is not taxable, regardless of who pays the premium

Dental Benefits
• Any premium paid by the Employer is not a taxable benefit to the Employee
• Any benefit paid is not taxable, regardless of who pays the premium

Critical Illness Benefits
• Any premium paid by the Employer is not a taxable benefit to the Employee
• Any benefit paid is not taxable, regardless of who pays the premium

Source: Benefits by Design: Group Insurance Contribution Report