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Severance Pay Calculator 2026
Use this severance pay calculator to estimate severance in the US from your salary and years of service. Apply your company’s policy, the common 1 to 2 weeks per year benchmark, or the New Jersey rule for mass layoffs.
- Weeks-per-year and minimum weeks settings
- New Jersey WARN Act mode
- Weekly pay worked out from monthly salary
Calculate severance pay
Pick a country, enter your salary and dates of service.
Severance basis
USD
Gross base pay before tax. Bonuses and commission are usually excluded.Your result is ready
Share a few details with your work email to see your result. We will also send you useful HR resources.
How severance pay is calculated in the US: there is no federal law requiring severance. Most employers pay 1 to 2 weeks of base pay for each year of service, often with a minimum of 2 to 4 weeks. In New Jersey, employers with 100 or more employees must pay 1 week per full year of service when they lay off 50 or more people in the state.
Severance pay formula
Severance = Weekly pay × Weeks per year × Years of service
Weekly pay is monthly base salary × 12 / 52. Bonuses and commission are usually left out unless your agreement says otherwise.
Worked example
Monthly base salary of $6,500 and 6 years of service, with a policy of 2 weeks per year. Weekly pay is $1,500. Severance: 1,500 × 2 × 6 = $18,000.
Is severance pay required in the US?
| Rule | What it requires |
|---|---|
| Federal law (FLSA) | No severance requirement |
| Federal WARN Act | 60 days of notice for plant closings and mass layoffs at employers with 100+ employees. Pay in lieu of notice covers it, but it is not severance. |
| New Jersey WARN Act (since April 2023) | 1 week of pay per full year of service for mass layoffs of 50+ employees, plus 4 weeks if 90 days of notice is not given |
| Company policy or contract | Commonly 1 to 2 weeks per year, minimum 2 to 4 weeks. Executives often receive more. |
What to check in a severance agreement
- How many weeks of pay are offered, and whether bonus or commission is included.
- Whether health coverage (COBRA premiums) is paid for a period.
- What release of claims you are asked to sign, and the deadline to sign it.
- Whether unused PTO is paid out, which depends on state law.
How to use the severance pay calculator
- Choose the severance basis. Company policy for most employers, or New Jersey mass layoff if that law applies.
- Set weeks of pay per year and minimum weeks. Use your policy, or 2 weeks per year as a common benchmark.
- Enter your monthly base salary. The severance pay calculator converts it to weekly pay.
- Enter your start date and last working day. Partial years count pro rata under a company policy.
- Click Calculate. You see weekly pay, weeks of severance and the total.
Example where the minimum applies
Monthly base salary of $5,200 and 1 year of service, with a policy of 1 week per year and a 2-week minimum. Weekly pay is $1,200. One week per year gives 1 week, so the minimum of 2 weeks applies: $2,400.
Is severance pay taxed?
Yes. The IRS treats severance as supplemental wages, so it is subject to federal income tax withholding, Social Security and Medicare. Many employers withhold federal income tax at the flat supplemental rate. State income tax may also apply.
Sources
This severance pay calculator is based on the following sources, reviewed in October 2026:
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Frequently asked questions
Is this severance pay calculator free?
Yes. The calculator is free. You share your name, work email and phone number once and can then calculate as many times as you like.
How much severance should I get?
A common benchmark is 1 to 2 weeks of base pay for each year of service, with a minimum of 2 to 4 weeks. Your company policy or employment contract decides the actual amount.
Is severance pay required by law in the US?
Not under federal law. New Jersey requires 1 week of pay per full year of service for covered mass layoffs. Most other severance is set by company policy or contract.
How is weekly pay calculated for severance?
Monthly base salary multiplied by 12 and divided by 52. Hourly employees usually use their regular hourly rate multiplied by normal weekly hours.
Is severance pay taxable?
Yes. Severance is treated as supplemental wages and is subject to federal income tax withholding, Social Security and Medicare.