Problem
Terry was ill for three months and missed work during this period. During the illness, Terry received $6,000 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.
Task
A. Terry has disability insurance provided by his employer as a nontaxable fringe benefit. Terry's employer paid $3,990 in disability premiums for Terry this year.
B. Terry paid $3,990 in premiums for his disability insurance this year.
C. Terry's employer paid the $3,990 in premiums for Terry, but Terry elected to have his employer include the $3,990 as compensation on Terry's W-2.
D. Terry and his employer share the cost of the disability insurance. Terry's employer paid $3,000 in disability premiums for Terry this year as a nontaxable fringe benefit, and Terry paid the remaining $990 of premiums from his after-tax salary.