Therefore, like all other insurance payments, it was not taxed. Payments in excess of covered cost become taxable income and is a retirement benefit due to disability. State does not tax retirement benefit income, IRS does. A reimbursement of covered cost is not income due to Income principle, Rule, or Statute. A Statute is an established rule.
Common sense shows that via taxation of all insurance benefits.
IDOR is taxing the entire proceeds of my disability plan. That can not be income. Without loss or cost the proceeds would not be paid. This is obvious indication the taxation is wrong. An insurance disability plan is a catastrophic health care insurance coverage.