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Barbara
Barbara, Enrolled Agent
Category: Tax
Satisfied Customers: 2846
Experience:  18+ years of experience in tax preparation; 25+ years of experience as a real estate/corporate paralegal.
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This is ***** *****. I was wondering how severance pay is

Customer Question

Hi this is ***** *****. I was wondering how severance pay is taxed in California. How much do I get paid out if the gross severance amount is $66000
JA: Thanks. Can you give me any more details about your issue?
Customer: my employment will get terminated and the employer offers me a one time package of $66000
JA: OK got it. Last thing — Tax Professionals generally expect a deposit of about $32 to help with your type of question (you only pay if satisfied). Now I'm going to take you to a page to place a secure deposit with JustAnswer. Don't worry, this chat is saved. After that, we will finish helping you.
Submitted: 9 months ago.
Category: Tax
Expert:  Barbara replied 9 months ago.

Welcome to Just Answer. My name is ***** ***** I will be happy to assist you.

Severance pay is subject to federal and CA tax.

The standard withholding rate for federal taxes on severance pay is 25 percent. The employer may choose to use the aggregate method. Using the aggregate method, the employer would add the supplemental wages to regular wages and calculate the total amount as regular wages.

The standard withholding rate for California state taxes is 6 percent.

Please let me know if you require further information or clarification.

Thank you and best regards,

Barb

Expert:  Barbara replied 9 months ago.

Just following up with you to see if you have any other questions or concerns. If so, please come back to me here, and I will be happy to assist you.

Best regards,

Barb

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