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When we figure how much to pay you, we must deduct
certain amounts, such as Medicare premiums and worker's
compensation offset.
* * * * *
We have to take into account your weekly workers'
compensation payment * * * when we figure your Social
Security benefits. Because you receive this payment,
we are withholding the benefits you are due.
Petitioner's 1992 Form SSA-1099, Social Security Benefit
Statement, reports that petitioner received total benefits for
1992 in the amount of $20,412.70. The Form SSA-1099 reports that
$770 of that total was paid by check or direct deposit, $318 was
attributable to Medicare premiums, and $19,324.70 was
attributable to worker's compensation offset.
On their 1992 Form 1040, U.S. Individual Income Tax Return,
filed jointly, petitioners reported Social Security benefits
received in the amount of $1,352. They further reported that
only $338 of that amount was taxable. Petitioners reported
adjusted gross income for 1992 in the amount of $40,474.18.
Respondent determined that the worker's compensation
petitioner received during 1992 must be included in his Social
Security benefits. The deficiency at issue results from the
corresponding increase in petitioners' adjusted gross income
because of such inclusion.
Petitioner contends that his worker's compensation benefits
should not be taxable because Matson paid them from a self-
insured fund.
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Last modified: May 25, 2011