I got my first severance check today. HALF OF THE CHECK was taken by taxes. The amount of the federal, state, medicare, etc is DOUBLE what is usually is (and the gross payment is about the same as my regular checks were). Anyone know if there is some sort of law that allows / requires them to take MORE out?? Same for my last paycheck, which was only 3 days of work and about 100 hours of vacation / discretionary time. I thought the severance checks were going to be higher, and I'm a little bummed at the amount. The taxes do NOT seem right.
I will call the company, but I wanted to see if any of you knew anything about this .... TIA!
Jenn04
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Re: HR / payroll employees, please help!
That sounds odd. definitely call. Only think I can think of is that they are large lump checks and are putting you in a higher salary bracket and taxing you more....could be the case but no clue!
Jenn04
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Re: HR / payroll employees, please help!
WAit I thought of something else - if they put it in as a luxury bonus by accident it may be taxed higher.
TrueLoveIn2008
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Re: HR / payroll employees, please help!
Thanks Jenna. The gross amount is close to the amount I got in each check - so it doesn't appear that they took the lump sum and taxed that - but I've read that severance payments are viewed as 'luxury' payments and are taxed at a higher rate. BOGUS. I'm really annoyed and upset about this. Going to call my accountant and then the co., just to clarify it's been done right.
Thanks for your help
Mici n KC
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Re: HR / payroll employees, please help!
They may have put it in as a bonus. Find out from your old company to see if this is what they did. It should say on the statement.
TrueLoveIn2008
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Re: HR / payroll employees, please help!
Posted by Mici n KC
They may have put it in as a bonus. Find out from your old company to see if this is what they did. It should say on the statement.
Doesn't say bonus on the statement. It's listed as severence. I spoke to my accountant and he said that what may have happened is that ADP may have put in the amount as 1 week's pay vs. 2 - and thus it looks like I was making a lot more - and thus they taxed me a lot more. I am emailing them now and will follow up with a phone call tomorrow.
