Submitted By: someone
Answered: January 16, 2019 8:54 pm

My company is closing and I’m going to receive a large amount of severance pay. When is this taxable?

Severance pay is taxable in the year in which it is received. If it’s received in a lump sum, then it’s taxable in one year. If it’s spread over two or more years, then the portion received in each year is taxable in that year.

Tax Glossary

Personal interest

Tax term for interest on personal loans and consumer purchases. Such interest is not deductible.

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