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Ask Dave

Paying On The Severance

John doesn't know how to handle his severance package as far as the tax goes.

QUESTION: John received a severance package in January and wonders if that goes on last year’s taxes or this year.

ANSWER: That depends on your employer. You obviously want to pick it up in 2009. Most likely, they put it in a W2 or a 1099 for 2008. It depends on which year the employer picks to issue the 1099 or W2 for that severance.

Tax Pro or File Your Own?

Take the Quiz

Tax Pro or File Your Own?

Use this free quiz to help you decide which tax filing method is right for you.
 
Take the Quiz

Tax Pro or File Your Own?

Use this free quiz to help you decide which tax filing method is right for you.
 
Take the Quiz