Income Benefits in Texas Workers' Comp Claims
When a work injury stops your paychecks, Texas workers' comp replaces part of your lost wages. The four types of income benefits, the order they arrive in, and how the weekly amount is set.
Two kinds of benefits, and this page covers one of them
A Texas workers' compensation claim pays two separate kinds of benefits. Medical benefits pay the doctors, hospitals, and pharmacies that treat your injury. Income benefits replace part of the wages you lose because of the injury, in the form of a check or deposit from the insurance carrier (the insurance company handling your claim for your employer).
This page covers income benefits: what types exist, when each one applies, and where the dollar amounts come from. Each benefit type has its own detailed page, linked below.
One point before anything else: income benefits never replace your full paycheck. Every type pays a percentage of your average wages, subject to a state maximum. The pages in this section explain exactly how much, so the first smaller-than-expected check does not catch you off guard.
What types of income benefits exist in Texas?
Texas workers' comp has four types of income benefits for injured workers: temporary income benefits (TIBs), impairment income benefits (IIBs), supplemental income benefits (SIBs), and lifetime income benefits (LIBs). A fifth category, death benefits, pays a worker's family when a work injury causes death. Most claims involve only the first one or two types; the others apply in more serious cases.
Here is each type in the order a typical claim meets them:
Temporary income benefits (TIBs) are the weekly checks most people mean when they say "workers' comp checks." They pay while you are recovering and either cannot work or are earning less than before because of the injury. Temporary Income Benefits (TIBs) explains when they start, when they stop, and what can interrupt them.
Impairment income benefits (IIBs) begin after a doctor certifies you have reached maximum medical improvement (MMI), the point where your condition has improved as much as it is expected to, and assigns you an impairment rating, a percentage measuring your permanent damage. You receive three weeks of IIBs for every percentage point. Impairment Income Benefits (IIBs) in Texas Workers' Compensation Claims covers how the rating turns into checks.
Supplemental income benefits (SIBs) can follow IIBs if your impairment rating is 15 percent or higher and your injury still keeps you from earning what you did before. You do not receive them automatically: you apply every quarter and must document your work search. Supplemental Income Benefits (SIBs) in Texas Workers' Compensation Claims explains the quarterly application and the strict rules around it.
Lifetime income benefits (LIBs) apply only to the most severe injuries the law specifically lists, such as certain amputations, blindness in both eyes, and some brain and spinal injuries. They pay for the rest of your life. Lifetime Income Benefits (LIBs) in Texas Workers' Compensation Claims lists the qualifying injuries.
Death benefits pay a portion of the worker's wages to a surviving spouse, children, or certain other family members, plus burial expenses. They run on their own eligibility rules and timelines. Death Benefits in Texas Workers' Compensation Claims explains who qualifies and for how long.
How the benefit types connect over a claim
The four types form a sequence, not a menu. TIBs come first, while you recover. MMI ends TIBs. If you have an impairment rating, IIBs follow. If the rating is 15 percent or higher, SIBs can follow IIBs. LIBs sit outside this sequence: if your injury qualifies, they replace it.
The transition points between benefit types are where most payment problems happen. A claim moving from TIBs to IIBs, or from IIBs to a first SIBs quarter, involves new paperwork, new calculations, and sometimes a new person at the carrier handling the file. If your checks change amount, change schedule, or stop at one of these transitions, that is the moment to ask questions in writing.
Where the dollar amounts come from
Every income benefit type starts from the same number: your average weekly wage (AWW), generally the average of your gross wages (before taxes) over the 13 weeks before your injury. Your employer reports those wages to the carrier on a wage statement, form DWC003. Average Weekly Wage in Texas Workers' Compensation Claims explains how the AWW is built and the mistakes that make it too low.
Your weekly check is a percentage of the AWW. That percentage, and the resulting dollar figure, is called your comp rate. Each benefit type uses a different percentage, and the state sets a maximum and minimum that change every year. Comp Rate: Your Weekly Benefit Amount shows the math for each type and how to check the carrier's numbers. Maximum and Minimum Comp Rates for Income Benefits covers the yearly caps. You can also estimate your own numbers with the income benefits calculator on this site.
Because everything downstream is a percentage of the AWW, an AWW error underpays every benefit type at once, week after week, for the life of the claim. It is the single most valuable number on your claim to verify early.
How long will income benefits last?
Each benefit type has its own stopping point, but there is also an overall deadline almost no injured worker has heard of: TIBs, IIBs, and SIBs all end no later than 401 weeks after your date of injury, which is roughly seven and three quarter years. Only two categories run past that line: LIBs continue for the rest of your life, and death benefits follow their own duration rules.
Within that ceiling, each type stops on its own terms. TIBs end when you reach MMI, when you return to earning your full wages, or at a statutory MMI date about two years after income benefits begin, whichever comes first. IIBs run three weeks per impairment percentage point. SIBs continue quarter by quarter only as long as you qualify and apply, and can end permanently before the 401-week mark if you miss too many consecutive quarters.
The 401-week deadline matters most for workers with high impairment ratings receiving SIBs. Those quarterly benefits do not run forever; they stop at the 401-week mark even if you still qualify. If you are years into a claim, it is worth calculating your own end date rather than assuming the checks continue indefinitely. Medical benefits are separate and do not end at 401 weeks: reasonable and necessary treatment for the injury is covered for life.
Do I have to pay taxes on my workers' comp checks?
No. Income benefits paid under the Texas workers' compensation system are not taxable income. The carrier does not withhold taxes from your checks and does not send you a W-2 or 1099 for them, and you do not report them as income on your tax return.
Two things confuse workers at tax time. First, the wages you earned before your injury that year are still taxable, and so are any wages from light-duty or modified work you did while on the claim. Those amounts appear on your W-2 as normal, so your W-2 can look wrong when it is actually right: it shows your taxable wages, not your comp benefits. Second, if you ever receive small unexplained checks from the carrier, often just a few dollars, those are usually statutory interest on benefits the carrier paid late (explained in Comp Rate: Your Weekly Benefit Amount). They are not wages and will not appear on a W-2.
If a tax preparer wants to list your comp benefits as income, ask them to check the rule for workers' compensation benefits before filing. This is one of the few questions in a comp claim with a clean answer: the benefit checks themselves are not taxed.
The pages in this section
01 Section overview Temporary Income Benefits (TIBs) ▸
02 Section overview Impairment Income Benefits (IIBs) in Texas Workers’ Compensation Claims ▸
03 1 page Supplemental Income Benefits (SIBs) in Texas Workers’ Compensation Claims ▸
04 Section overview Lifetime Income Benefits (LIBs) in Texas Workers’ Compensation Claims ▸
05 1 page Death Benefits in Texas Workers’ Compensation Claims ▸
06 5 pages Average Weekly Wage in Texas Workers’ Compensation Claims ▸
07 Section overview Comp Rate: Your Weekly Benefit Amount ▸
08 Section overview Maximum and Minimum Comp Rates for Income Benefits ▸
09 Section overview When the Carrier Takes Money Back: Advances, Overpayments, and Recoupment ▸
10 Section overview Texas Workers Comp Income Benefits Calculator ▸
11 Section overview When Your Comp Checks Stop Coming ▸
Attorney notes regarding income benefits
Income benefits can become one of the most confusing parts of a Texas workers’ compensation claim. Even when the insurance carrier is sending checks, that does not necessarily mean the right benefits are being paid, in the right amount, or for the right length of time.
A few warning signs deserve attention:
- Your checks suddenly stop or decrease: There should be a reason, and that reason may be disputed.
- Your wages look wrong: An incorrect Average Weekly Wage can affect the amount of benefits you receive.
- You return to work for less money: You may still have rights to income benefits in some situations.
- Your impairment rating seems too low: A lower rating can mean fewer weeks of Impairment Income Benefits.
- You receive a denial: Eligibility for SIBs, LIBs, or other income benefits can involve detailed rules that are easy to misunderstand.
- The carrier claims it overpaid you: Do not assume that a demand for repayment is automatically correct.
At Abbott, Clay & Bedoy, we review benefit payments, wage calculations, medical evidence, work status, impairment ratings, and carrier decisions to determine whether our clients are receiving the income benefits Texas law provides.
Workers’ compensation checks can affect your ability to pay the mortgage, buy groceries, and support your family while you recover. Getting the amount wrong matters.
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