01:00 AM EST on Tuesday, March 8, 2005

If you're disabled, but work part-time, must you pay in to Rhode Island's Temporary Disability Insurance (TDI) program? That's the question a woman from Johnston asked MoneyLine:

Q: I am on disability, and my question was, why do I pay into TDI when I'm already disabled? I work part-time, and I asked my employer, and they said that I have to pay in to it . . . .

D.M., Johnston

A: Here's the general rule: If you work in a job that's covered by TDI, you must pay in to the TDI system, said Raymond A. Filippone, assistant director of the Rhode Island Department of Labor and Training who oversees TDI.

What about someone in your particular circumstances? "As long as she's working, and her wages are subject to [TDI] tax, then she has to pay the tax," Filippone said in an interview at the agency's headquarters in Cranston.

"She can't opt out of the TDI system. It's mandatory," Richard J. Fitzgerald, TDI administrator, said in the interview.

So the key isn't whether you're disabled, or what type of disability benefits you may be receiving; it's whether you work -- no matter if it's part time or full time -- that determines whether you must pay TDI tax (which serves as a kind of insurance premium).

State law requires that people who work in Rhode Island be covered under the TDI umbrella and pay in to the TDI fund.

In general, TDI covers those who work in the private sector. It also covers some city and town workers, and some employees of religious organizations.

It does not cover the following groups: federal workers, state workers, the self-employed, and those who work in "supported employment programs" (formerly known as sheltered workshops), Filippone said in a follow-up telephone interview.

There are a couple of points to keep in mind:

If you work in a job that's covered by TDI, and pay in to the TDI system, you will be eligible for benefits if you suffer an injury or illness that is not work-related.

In other words, assuming you meet the rules, you can collect TDI benefits even if you're also receiving benefits from Social Security disability or a private-sector disability plan, Filippone said.

"TDI doesn't look at any other disability benefit that an individual receives" for purposes of determining whether he or she can qualify for benefits and how much he or she might receive, he said.

The TDI tax this year is equal to 1.4 percent of the first $49,000 of a worker's pay. Thus, the maximum TDI tax for 2005 is $686.

The maximum weekly TDI benefit is $588 (although the weekly benefit can be as much as $793, depending on the number of dependents a claimant has.)

Governor Carcieri recently proposed some changes to the TDI program. For example, under current rules, you can't collect TDI benefits if you go back to work -- even if it's part-time work. Carcieri's proposal would allow people to do some work and collect a partial TDI benefit. "This enables an individual to do some work and not be penalized for trying to be productive," according to a summary of Carcieri's legislative agenda. "The TDI benefit would be reduced dollar for dollar by weekly earnings that exceed one-fifth of their weekly benefit rate."

For more information about the TDI program, including details about benefits and eligibility, call (401) 462-8420, or see this state Web site:

www.dlt.ri.gov/tdi

INCOME-TAX UPDATE: More income-tax returns are being filed electronically this year, the Internal Revenue Service said last week. Here are some numbers:

Rhode Island: Of the estimated 161,000 Rhode Island federal tax returns filed through Feb. 25, more than 115,000 were filed electronically. In other words, e-filing accounts for about 71 percent of all returns filed, up from 65 percent the previous year, the IRS said.

Included in the tally of electronically filed returns are those filed by phone, through the IRS's TeleFile program (about 8.6 percent of the total). Most are filed by computer (about 91.4 percent of the total).

Massachusetts: Of the about 927,000 federal returns filed from Massachusetts so far, 69 percent were e-filed, up from 62 percent last year.

U.S.: Nationwide, 74 percent of returns filed so far have been e-filed, up from 69 percent last year, the IRS said.

The jump coincides with a sharp increase in the use of Free File, the free online tax preparation and electronic filing program that's available through the IRS Web site, www.irs.gov.

More than 2.77 million returns nationwide have come in through Free File so far, up about 43 percent from last year, the IRS said.

Refunds: The average federal income-tax refund so far this season is $2,436, up about $200 over last year.

TODAY'S TIP: If you're trying to simplify your financial life, read the latest issue of "FDIC Consumer News," a free quarterly newsletter published by the Federal Deposit Insurance Corporation.

It includes a list of things you can do to make bill-paying, banking and other financial chores easier.

The issue also includes articles about electronic banking; the fees and other costs associated with refund anticipation loans; and a brief look at how deposits are covered when a bank fails.

For a free copy, or a free subscription, call the FDIC toll-free at 1-877-275-3342; write FDIC Public Information Center, 801 17th St. NW, Room 100, Washington, D.C. 20434; or see this Web site:

www.fdic.gov/consumers

Neil Downing is a Journal staff writer and author of The New IRAs and How to Make Them Work for You. Questions about your money matters? Call us at 1-401-277-7484 and leave a message, or e-mail:

moneyline [at] projo.com

Sorry, no personal replies; as many questions and issues as possible will appear here.