Severance Pay Calculator
Calculate severance pay based on tenure, salary, and company policy
About this calculator
A severance pay calculator helps employees and employers determine the appropriate severance compensation based on key factors like length of employment, current salary, and company-specific policies. This tool provides accurate estimates for severance packages, ensuring fair compensation during job transitions. Whether you're facing layoffs, termination, or negotiating departure terms, understanding your potential severance pay helps you make informed financial decisions and plan for your career transition period effectively.
How to use
Enter your current annual salary, years of service with the company, and select your company's severance policy (if known). The calculator will process these inputs using standard severance formulas to estimate your potential payout. Review the results to understand your expected severance compensation amount.
Frequently asked questions
How is severance pay typically calculated?
Severance pay is commonly calculated as 1-2 weeks of salary per year of service, though policies vary significantly between companies and industries.
Are there legal requirements for severance pay?
In most US states, severance pay isn't legally required unless specified in employment contracts or company policies. Requirements vary by jurisdiction.
Is severance pay taxable income?
Yes, severance payments are generally considered taxable income subject to federal and state income taxes, plus employment taxes like Social Security.