What is the taxes rate on separtion agreement from your employer?

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2026-03-20 12:20

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The tax rate on a separation agreement from your employer typically depends on how the payments are classified. Severance pay is generally considered ordinary income and is subject to federal income tax, Social Security, and Medicare taxes. Additionally, some states may impose their own taxes on this income. It's advisable to consult a tax professional for specific guidance based on your situation.

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