For an employer-sponsored group disability income policy:

a. Premiums are always paid with after-tax dollars and benefits are received tax-free.

b. Premiums are always paid with pre-tax dollars and benefits are treated as taxable income.

c. Premiums paid by the employer are tax-deductible as a business expense.

d. Benefits are 100% taxable if the employee pays a portion of the premiums.

Answer: c. Premiums paid by the employer are tax-deductible as a business expense.