TTD, TPD, PTD, and PPD: Decoding the alphabet soup of work-comp benefits

Two of the most frequent questions when it comes to workers’ compensation benefits are: “What are all these acronyms, and what’s with all the Ds , Ps, and Ts?” Well, TPS Reports they are not, Office Space fans. Each acronym, in fact, represents a separate and specific kind of benefit. Three of them consist of wage-loss benefits, and the other is compensation for loss of function or functional impairment.

Wage-loss benefits

TTD: “Temporary total disability.” This is the benefit you receive when you cannot work at all. When you are hurt, have full work restrictions, and are no longer collecting any paychecks, you are entitled to TTD benefits. These are payable at two-thirds of your average weekly wage (“AWW”) before your injury.

TPD: “Temporary partial disability.” This is the benefit you receive when you can work after injury, but not at the same level as before you were hurt. You have work restrictions, but they are partial restrictions. You are earning some income, but not the same amount as before you were hurt. TPD is intended to make up the difference. It is payable at two-thirds of the difference between your AWW and your weekly income after injury.

PTD: “Permanent total disability.” This is the benefit you receive once it is ultimately determined that you cannot return to work due to your work injury. Both TTD and TPD have duration limits of a few years. PTD, on the other hand, is basically TTD that pays out until your presumptive retirement date. Like TTD, it is payable at two-thirds of your AWW. There are, however, certain offsets that apply to PTD benefits that do not apply to TTD.

Functional-impairment benefits

PPD: “Permanent partial disability.” This is not wage loss compensation, nor is this compensation for pain and suffering. PPD benefits compensate for permanent loss or impairment of a bodily function, and are in no way dependent upon wage loss or ability to work. PPD benefits are specific to the type of injury and body part injured, and some injuries are worth more than others. You are generally entitled to PPD benefits after a doctor determines that you have healed as much as you are going to heal from the work injury, otherwise known as reaching “maximum medical improvement” (or “MMI,” which is a lot less complicated than all these D’s, P’s, and T’s).

IRS bonus

Workers’ compensation benefits – namely all of the beneficial acronyms listed here – are considered non-taxable under 26 U.S. Code § 104 (a). So what you see is what you get with TTD, TPD, and PTD payments; you do not have to pay taxes on these workers’ compensation benefits. This is also why, in part, these benefits are paid out at a fraction, two-thirds, of the whole income loss (which would have otherwise been taxable if earned as wages or salary).

- Jeff