A friend who was laid off from another company several years ago told me that because the amount of severance usually is in the higher tax bracket, the final amount you receive is significantly lower than many people expected. He himself had a rude awakening when he saw the final number.
I was wondering if there was a way to get it paid out in several installments, to avoid losing out on so much due to tax?
Severance pay is taxed at a higher amount than your regular wage. It has been that way for years. Doesn't matter if you take it all at once or over a few payments you'll still pay the same amount in taxes. Severance is considered a gift not a wage.
Make sure it was full 8 weeks not Including the 2 weeks since July 2-it's really 6 weeks fyi
What about 401k taken over by dceh -- have heard some having trouble getting dceh to release funds even though 100% vested. Anyone experience this yet?
Ask Debbie at AiFL about severance pay!! She was fired, not laid off!!! hahahahaha ding dong the troll witch is dead!!!!
What makes you think there will be severance pay? I was laid off last summer and we got one week per year with a max of 12. A more recent post noted a max of 8. The numbers are dropping folks. By the time they lay off the last of us there will be nothing.
Why would you want DCEH to hold on to any of your money?
Take what you can get and follow the advice from -1sms on changing your W4.
The crap should be scared out of them. Not everyone is getting fair severance- it depends on the school, the position, and length of service. First-hand knowledge.
Severance pay is treated as taxable income like any other earnings.
You will have a lot more withheld due to the way taxes are withheld, but will get it back when you file your taxes.
One strategy that would work is if you can still file a new W4 (tax withholding) form and claim more exemptions. It is legal to do so. Remember to do it for both federal and state. If you think you will be out of work for an extended period of time, you can have zero taxes withheld and make it up by claiming fewer exemptions when you file the w4 at your new job.
Since your friend is no longer employed, this won't help, but may be of help to someone in the future.
I was just let go on Friday after 12 years with Ai and only received 8 weeks of severance - I was told it is the maximum amount they will pay. I wish folks would quit saying there will be no severance - it is scaring the crap out of the folks who are still there and not sure what is in store. . . remember, the people left there need to hear reality not rumors. Off my soap box!
When I got severance after being fired last June, it was one lump sum, with a lot of taxes money taken out (several thousand). No options for installments. I wouldn't worry, though, thinking Dream Center isn't one to do severance like EDMC was and that's saying something.
There will be no severance paid to any employee according to the HRG that we spoke to