Kim is struck in the rear of her candy apple red sports car. Her injuries are severe, leaving her unable to work as a hostess at a high-end restaurant in New Orleans. The restaurant offers employees disability insurance, which she has elected as part of her employee benefits package. She pays for 50 percent of the insurance on a pre-tax basis. The employer pays the remainder of the policy premium. Her monthly benefit is $2,500 per month. Which of the following is correct?

-None of her benefit will be subject to income tax

-100% of her benefit will be subject to income tax

-Two-thirds of her benefit will be subject to income tax

-50% of her benefit will be subject to income tax