Please furnish me with the Code Section that makes these payments free of federal income tax.

Look to Sec 104, in which the disability payment is charged to the employee as an after-tax contribution while working.

Several gov't plans have this feature. Their tax disclosures explain their intent to treat these payments as accident and health payments.

Joel, don't assume that all disability payments are tax-free. In fact most programs associated with retirement plans probably are not. SoCal describes a plan that has obviously tried to structure the plan in a manner that gives them the best "argument" for treating the disability income as tax free. The IRS has taken a pretty narrow view of what qualifies. Other factors for claiming tax-free status are the disability cannot be tied to age or service or retirement benefits under the plan. It has to have been established as a clearly separate accident and health program (although I believe it's ok if its' combined in the same plan doc as a retirement plan if clearly a separate program with different types of benefits than the retirement plan). In short, it needs to be structured properly, and even then be prepared for a fight.