severance pay and effect on earned income for earned income tax credit

I recently learned that my job was closing our branch. Iwas given a package for a signing bonus and severance pay for 16 weeks. Will my severance pay be considered as earned income for tax purpose. Will I be able to file severance as wages on my tax return?

1 answer  |  asked Aug 20, 2005 10:57 PM [EST]  |  applies to Texas

Answers (1)

Trey Henderson

Severance payments are typically paid as wages and the tax treatment for Federal purposes is the same as if you had worked for the money.

posted by Trey Henderson  |  Aug 21, 2005 08:25 AM [EST]

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