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A BILL TO BE ENTITLED
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AN ACT
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relating to the consideration of certain wage replacement |
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disability benefits received by an injured employee as benefits in |
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the nature of workers' compensation for certain federal tax |
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purposes. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Subchapter A, Chapter 406, Labor Code, is |
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amended by adding Section 406.0025 to read as follows: |
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Sec. 406.0025. CONSIDERATION OF CERTAIN WAGE REPLACEMENT |
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DISABILITY BENEFITS AS WORKERS' COMPENSATION BENEFITS. A wage |
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replacement disability benefit paid by an employer that does not |
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carry a workers' compensation insurance policy to an employee who |
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sustained an injury in the course and scope of employment and is |
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unable to return to work because of the injury is considered to be a |
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payment made under a statute in the nature of a workers' |
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compensation statute solely for the purpose of determining whether |
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the benefit is excluded from taxable income for purposes of federal |
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income and employment taxes. |
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SECTION 2. The enactment of this Act is a clarification of |
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existing law and does not imply that existing law may be construed |
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as inconsistent with the law as amended by this Act. |
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SECTION 3. This Act takes effect September 1, 2025. |