Severance pay is money an employer gives you when ending your employment, separate from your regular final paycheck. It may come as a lump sum, ongoing payments, or a combination. Understanding how severance affects your taxes, retirement accounts, and financial planning matters because the tax treatment varies depending on what type of severance you receive and how it's structured.
The articles here cover practical questions: whether severance counts as taxable income, how to handle it if you have a 401(k) or other retirement savings, whether to negotiate the amount or payment schedule, and how severance interacts with unemployment benefits. You'll also find information about timing decisions—like whether to take a lump sum now or spread payments across the next year—and how those choices affect your tax bill.