xfire[at]earthlink.net says...

- quote -

snip

You do not state what section of the Gov Code you retired
under. If your disability is "heart" then there are further
problems you might face. This is the "presumptive" provision
which is not excludable income. I can't answer your initial
questions as I have never had a client in that status but I
consider myself an expert in the other acpects of disability
37 act pensions (I am retired disability law enforcement
from San Diego). Feel free to contact me further on this
forum only.

Cliff Powell
CA Tax Preparer

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xfire[at]earthlink.net (Bob W) wrote:

- quote -


This should have been explained to you by your county
retirement system before you accepted a rehab'd position.

Under CA Govt. Code section 31725.6(g), your service credit
will continue as a safety member, as defined in Govt. Code
31469.3, and not withstanding the restrictions of section
31560 limiting saftey member service to an actual safety
position. In addition, you should be paid for any difference
between the disability retirement pay rate and the rehab
salary, if it is less. But you are actually working for less
money, because your wages in the new position, not being
paid under the disability provisions of the Govt. Code, are
taxable. The differential pay is not taxable.

When you retire it will be the same as if you had been
retired initially, unless you have earned service credit
putting you over fifty percent of FAS, in which case the
amount exceeding the fifty percent will be taxable.If the
new position FAS is higher, your 50% for purposes of
Internal Revenue Code section 104(a) will be based on that
amount when you retire, not the original amount.

Timothy E Kelly, Esq. Certified Specialist, Taxation Law
State Bar of Califonria Board of Legal Specialization

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I am a medically retired Firefighter from a 37 Act County in
California. I rehabilitated under Calif Gov Code 31725.6,
and returned to work in a "Non-Safety" position.

Had I chosen to take a service-connected disability and
retire, then I would have received 50% of my Final Average
Salary. This would have been tax free (CA & IRS).

My question is for the Calif Tax Preparers that have dealt
with clients in this category.

When your client retired from the "Non-Safety" position,
what did their monthly check consist of?

A. 50% of FAS, Tax Free, based on their salary as of the
date of injury?

B. A + all COLA's up to the date of retirement?

C. (A&B) + the FAS from the Non-Safety position.

D. ??????????????

Sorry if this is the wrong group, but I couldn't find any
other group to post this question to. Thanks in advance for
your help

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