Disability benefits may be subject to Social Security and Medicare taxes (FICA taxes) as well as Federal Income Tax, depending on the type of policy and funding structure your employer has chosen. If your benefit is subject to FICA taxes, they will be withheld automatically from your benefit payments. You may elect to have optional Federal Income Tax withheld by submitting the IRS form W-4S. Any required and optional tax withholding amounts will be reflected on the Explanation of Benefits (EOB) that accompanies each benefit payment.