Is sick pay from an employer considered taxable if it exceeds a certain duration?

Sick pay from an employer is generally considered taxable income if it exceeds a certain duration because it is treated similarly to regular wages for tax purposes. The IRS requires that wages, including sick pay, be subject to income tax withholding, Social Security taxes, and Medicare taxes.

When sick pay is provided as a continuation of regular salary, particularly if it is paid for a prolonged period, it falls under the same category as compensation for work performed, thus making it taxable. This treatment ensures that any income received by employees, regardless of the circumstances surrounding its receipt, is uniformly subject to taxation.

In this context, the duration of the sick pay can trigger taxability, as shorter periods may be offered as part of a disability plan that could have different tax implications. However, the standard rule is that once sick pay becomes a part of the employee's income over a certain length of time, it is treated as regular income.