May previous employer gave me 20 weeks of severance pay, to be paid bi-weekly, I was 62 at the time

Question

May previous employer gave me 20 weeks of severance pay, to be paid bi-weekly, I was 62 at the time

Anonymous Jul 14, 2010 2 views 1 answers

I filed for social security and payments began the following months, now Social Security wants 10,000 back because of wages, but it was severance pay, my understanding is that I did not have to report severance pay as income? was I wrong?

Randall Brett · Accepted Answer · 2026-06-20T17:58:08+00:00

Severance pay is treated as income, even if the severance was consideration for you to sign a release of your rights to sue (which is very common when severance is provided). The Social Security regulations contain a very broad description of income for purposes of entitlement to benefits. I recommend that you talk with an accountant who will help you determine both your tax liability and how much (if any) of your Social Security payments you must return.

May previous employer gave me 20 weeks of severance pay, to be paid bi-weekly, I was 62 at the time

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