Severance Pay Calculator
Facing a layoff or negotiating a separation package? This free severance pay calculator estimates your lump-sum severance from your annual salary, years of service, and your employer's weeks-of-pay-per-year policy — the most common formula US employers use. Enter your numbers and see your estimated payout instantly.
Enter your numbers
Your estimated severance
| Weekly pay (salary ÷ 52) | $1,538.46 |
|---|---|
| Service weeks | 10.00 |
| Additional flat weeks | 0.00 |
| Total weeks of pay | 10.00 |
| Lump-sum estimate | $15,384.62 |
This is an estimate, not a guarantee. Actual packages depend on your employer's severance policy, negotiations, caps, and eligibility rules. Severance is generally taxed as supplemental wages, so your take-home will be lower after federal, state, and FICA withholding.
How to use this calculator
Start with your annual salary — your gross base pay before taxes. Next, enter your years of service; fractions are allowed, so use 7.5 if you've been with the company for seven and a half years.
Then set the weeks of pay per year of service from your employer's policy (usually 1–4). If your package also includes a flat bonus — for example, 2 extra weeks for employees with 10+ years — add it under additional flat weeks. Results update instantly as you type.
How it works
The math is the industry-standard severance formula:
Weekly pay = annual salary ÷ 52. Service weeks = weeks of pay per year of service × years of service. Estimated severance = weekly pay × (service weeks + additional flat weeks).
For example, an $80,000 salary gives $80,000 ÷ 52 = $1,538.46 per week. Five years of service at 2 weeks per year is 10 weeks of pay, so the lump-sum estimate is $1,538.46 × 10 = $15,384.62.
This calculator makes a few assumptions: it uses the most common weeks-per-year formula, ignores policy caps on total weeks, and doesn't subtract taxes or add extras like COBRA subsidies, outplacement services, or unused vacation payouts. Treat the result as an estimate — your employer's written policy and any negotiations decide the final number.
Frequently asked questions
How much severance will I get for 5 years of service?
It depends on your employer's policy, but with the common 2-weeks-per-year-of-service formula, 5 years of service equals 10 weeks of pay. On an $80,000 salary ($1,538.46 per week), that's about $15,384.62. Seniority bonuses or negotiated extras can increase it.
Is 2 weeks per year standard for severance?
Yes — 1 to 2 weeks of pay per year of service is the most common benchmark in the United States, with many large employers offering around 2 weeks per year plus a minimum number of weeks. Some policies cap total weeks, add flat bonuses for seniority, or offer extra weeks for executives. Check your offer letter or employee handbook for the exact formula.
Is severance pay taxed?
Yes. Severance pay is taxable income, taxed as supplemental wages just like bonuses. Employers typically withhold federal income tax at a flat 22% supplemental rate (for amounts up to $1 million), plus state tax and FICA (Social Security and Medicare). Your final tax depends on your total income for the year when you file.
Can I negotiate severance?
Often, yes. If you're being offered a severance package — especially during a layoff or mutual separation — you can usually negotiate the number of weeks, an extra flat bonus, extended health coverage (COBRA subsidies), outplacement services, or the non-compete terms. An employment lawyer can review the agreement before you sign.
Do I get severance pay if I'm fired for cause?
Usually not. Severance is most commonly paid for layoffs, position eliminations, and sometimes voluntary departures or mutual separations. Employees fired for misconduct are generally excluded from severance plans, though a few employers make exceptions. Your company's severance policy or handbook decides who qualifies.