Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Terry was ill for three months and missed work during this period. During the illness, Terry received $8,100 in sick pay from a disability insurance

Terry was ill for three months and missed work during this period. During the illness, Terry received $8,100 in sick pay from a disability insurance policy. What amounts are included in Terry's gross income under the following independent circumstances? Note: Leave no answer blank. Enter zero if applicable.

a. Terry has disability insurance provided by his employer as a nontaxable fringe benefit. Terry's employer paid $5,860 in disability premiums for Terry this year. What is the amount included in Gross Income?

b. Terry paid $5,860 in premiums for his disability insurance this year. What is the amount included in Gross Income?

c. Terry's employer paid the $5,860 in premiums for Terry, but Terry elected to have his employer include the $5,860 as compensation on Terry's W-2. What is the amount included in Gross Income?

d. Terry and his employer share the cost of the disability insurance. Terry's employer paid $4,500 in disability premiums for Terry this year as a nontaxable fringe benefit, and Terry paid the remaining $1,360 of premiums from his after-tax salary. What is the amount included in Gross Income? (Note: Do not round intermediate calculations. Round your answer to the nearest whole dollar amount.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

More Books

Students also viewed these Accounting questions