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Merlo, Accountant
Category: Tax
Satisfied Customers: 9783
Experience:  25+ years tax consulting. Specializing in returns for US citizens living abroad
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I have worked in Caifornia for 4 years. I am being laid off

Resolved Question:

I have worked in Caifornia for 4 years. I am being laid off on Friday. I will move to Texas over the weekend. I changed my permanant address with my employer. My severance payment will be held for 7 days and mailed to me in Texas. Is the severance payment subject to California state income tax?
Submitted: 6 years ago.
Category: Tax
Expert:  Merlo replied 6 years ago.

Hello patrolia,


As long as the payment you are receiving is attibutable to the work you performed in the state of California, then that payment is subject to CA state taxes, regardless of where you live at the time the payment is made to you.


Even though the severance pay is not actually for services you provided, it is directly related to the services you provided while with this company, and is therefore subject to CA tax.


These same rules regarding severance pay apply to all states, and not just to the state of California.


If this was helpful please press the Accept button.


Thank you patrolia



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