§ 6-3-2-9 — Disability retirement; deduction; amount

Indiana § 6-3-2-9

• Jurisdiction: Indiana
• Art. 3: STATE INCOME TAXES
• Ch. 2: Imposition of Tax and Deductions

Text

(a) An individual who:
(1) retired on disability before the end of the taxable year; and
(2) had a permanent and total disability, as determined under
subsection (c), at the time of retirement;
is entitled to a deduction from the individual's adjusted gross income
for that taxable year in the amount determined under subsection (b).
(b) The deduction provided by subsection (a) is the amount
determined using the following STEPS:
STEP ONE: Determine the amount received by the individual
during the taxable year through an accident and health plan for
personal injuries or sickness to the extent that:
(A) these amounts are attributable to contributions by the
individual's employer that were not includable in the
individual's gross income or are paid by the employer; and
(B) these amounts constitute wages or payments in lieu of
wages for a period during which the employee is absent from
work because of permanent and total disability.
STEP TWO: Determine for each week of the taxable year the
amount by which each weekly payment referred to in STEP ONE
exceeds one hundred dollars ($100), then add these amounts.
STEP THREE: Determine the amount by which the individual's
federal adjusted gross income for the taxable year, as defined by
Section 62 of the Internal Revenue Code, exceeds fifteen
thousand dollars ($15,000), or seven thousand five hundred
dollars ($7,500) in the case of a married individual filing a
separate return.
STEP FOUR: Subtract from the amount determined in STEP
ONE the amount determined in STEP TWO and the amount
determined in STEP THREE.
(c) For purposes of this section, an individual has a permanent and
total disability if the individual is unable to engage in any substantial
gainful activity by reason of any medically determinable physical or
mental impairment that can be expected to result in death or that has
lasted or can be expected to last for a continuous period of not less than
twelve (12) months. An individual may not be considered to have a
permanent and total disability unless the individual furnishes proof of
the existence of the disability as the department of revenue may
require.

Legislative History

As added by P.L.76-1985, SEC.3. Amended by P.L.47-2001, SEC.1; P.L.99-2007, SEC.26; P.L.146-2020, SEC.24.