- 5 - benefit. Sec. 86(d)(3).3 See Mikalonis v. Commissioner, T.C. Memo. 2000-281; Willis v. Commissioner, T.C. Memo. 1997-290. The rationale for this provision appears in the legislative history accompanying that enactment of section 86 by the Social Security Amendments Act of 1983, Pub. L. 98-21, sec. 121, 97 Stat. 80: Your Committee’s bill provides that social security benefits potentially subject to tax will include any workmen’s compensation whose receipt caused a reduction in social security disability benefits. For example, if an individual were entitled to $10,000 of social security disability benefits but received only $6,000 because of the receipt of $4,000 of workmen’s compensation benefits, then for purposes of the provisions taxing social security benefits, the individual will be considered to have received $10,000 of social security benefits. [H. Rept. 98-25, at 26 (1983).] In other words, the purpose of section 86(d)(3) is to equalize 3 Sec. 86(d)(3) provides as follows: SEC. 86(d). Social Security Benefit.-- * * * * * * * (3) Workmen’s compensation benefits substituted for social security benefits.–-For purposes of this section, if, by reason of section 224 of the Social Security Act * * *, any social security benefit is reduced by reason of the receipt of a benefit under a workmen’s compensation act, the term “social security benefit” includes that portion of such benefit received under the workmen’s compensation act which equals such reduction. At trial, Mrs. Flores testified that she received workmen’s compensation in an amount greater than the $11,855 “offset” that was identified in her 2002 Form 1099-SSA, described supra p.3. In this regard, we emphasize that sec. 86(d)(3) serves to treat workers’ compensation benefits as though they were Social Security benefits only to the extent of the offset amount.Page: Previous 1 2 3 4 5 6 7 8 Next
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