I am on permanent long term disability. I receive Social Security and a disability payment from my previous employer. The payment from my previous employer comes with a W2 form with the notation "sick pay" on it. I had always assumed I was not eligable to open an IRA because these payments are not "earned income". My tax accountant recently informed me she thought because the disability from my previous employer is reported on a W2 form that I am eligable to open an IRA. She said the tax code is somewhat vague regarding this issue. I would really like to open an IRA but I also don't want to get in trouble with the tax people. Does anyone have an oppnion regarding how sick pay and earned income are viewed by the government?
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