DISABILITY PAYMENTS

[GeorgeM]

I have a client who collected disability payments from an insurance company, and then was accepted by SSI disability. He had to pay back the insurance company the money he received from SSI. How do I report this do I am mend 2007 or deduct from the payment received in 2008

Thank you

[jainen]

>>He had to pay back the insurance company<<

You can not directly offset the income. See the discussion of repayments on page 33 of Pub 525. http://www.irs.gov/pub/irs-pdf/p525.pdf I assume you mean the insurance payment was taxable in 2007, and that he is now getting Social Security Disability based on a work record (not SSI which is non-taxable).