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Severance calculator: what your package is worth and how long it lasts
Just laid off, or weighing a buyout? See your severance after withholding, how many months it lasts with savings and unemployment, and whether a buyout beats staying: free, no sign-up, and your numbers stay in your browser.
Severance pay after taxes: how the calculator works
Start with your weekly pay: your salary divided by 52. Most packages give you a set number of base weeks plus extra weeks for each full year you worked there, sometimes up to a cap. Multiply those weeks by your weekly pay and you have your severance. Unused PTO is paid at your daily rate, your annual salary divided by 260, and a prorated bonus is your target times the months you worked this year over 12.
Employers usually withhold from a lump sum as supplemental wages: a flat 22% federal rate (37% on anything over $1 million), 6.2% Social Security (only on wages up to $184,500 in 2026, counting what you've already earned this year, which the calculator doesn't know: it applies the cap to your package alone) and 1.45% Medicare, plus whatever state withholding you enter. What's left is your estimated take-home. Months of COBRA your employer pays for are part of the package's value but not cash.
Example: Sam, a made-up employee, earns $130,000 and leaves after 4.5 years under a formula of 16 weeks plus 1 week per completed year. That's 20 weeks at $2,500, or $50,000, plus 8 PTO days at $500. That's $54,000 before taxes and about $37,989 after withholding, plus 6 months of paid COBRA worth $4,500.
How long will my severance last?
The runway adds your take-home and your savings, then spends your monthly budget week by week. Once the months of COBRA your employer covers run out, the full premium is added to your spending. Unemployment benefits, if you count them, arrive each week after the delay you enter. The money runs out when the balance can't cover another week.
With $20,000 in savings and $4,500 a month in spending (plus a $750 COBRA premium once the paid months end), Sam's money lasts about 11.9 months, until around November 2027. Add $500 a week in unemployment for 26 weeks and it stretches to about 14.4 months, into February 2028.
Should I take a buyout?
Buyout mode compares two paths over the months you expect to keep your job if you stay. Staying pays your take-home salary for all of them. Taking the buyout pays its take-home now, then your new job's take-home once you find one, less anything you give up by leaving, like unvested equity or a 401(k) match. Both sides use the same flat withholding so they compare fairly. If the two land within 5% of each other, it's basically a wash, so let job security, your career and your health coverage decide. Heads-up: taking a voluntary buyout can make you ineligible for unemployment.
What's in a severance package?
No federal law requires severance, so the formula is up to your employer. One exception: in a large layoff, the WARN Act requires 60 days' notice or pay in place of it, and some states require more. One to two weeks per year of service is common, and many tech companies add a base of several weeks; Dropbox's October 2026 layoff paid 16 weeks plus 1 week per completed year, with 6 months of COBRA.
A package can include severance pay, unused PTO, a prorated bonus, health insurance through COBRA, accelerated vesting and outplacement services. Some packages also claw back a signing or retention bonus: enter that as a negative lump sum. Read the agreement before you sign: most ask you to release legal claims, and some add a non-compete or a review and revocation window.
Severance FAQ
How much severance should I get?
It depends on your employer's formula, since no federal law requires severance (in a large layoff, the WARN Act requires 60 days' notice or pay in place of it). One to two weeks of pay per year of service is common, and many larger employers add a base of several weeks plus months of paid COBRA. Enter your package's formula in the calculator to see what it's worth.
Is severance taxed at 22%?
Usually, for withholding. Most employers withhold a flat 22% federal rate on severance (37% on supplemental pay over $1 million in a year), plus 6.2% Social Security on wages up to $184,500 in 2026, 1.45% Medicare and any state tax. That's withholding, not your final bill. Severance is taxed as ordinary income when you file, so depending on your bracket you could owe more or get some back.
Does severance affect unemployment?
In some states it does. Severance can delay or reduce unemployment benefits, depending on how and when it's paid. A voluntary buyout may make you ineligible altogether. Check your state's rules before you count on benefits.
Should I take a voluntary buyout?
Compare what you'd take home by staying with the buyout plus your new job's pay once you find one, over the months you expect to keep your job. The calculator's buyout mode does this math. If the two come out within about 5%, decide on non-money factors like job security, your career and your health insurance.
Can I negotiate my severance?
Often, yes, especially if you're asked to sign a release of claims. People ask for more weeks, longer COBRA coverage, a prorated bonus, accelerated vesting or a neutral reference. If you're 40 or older, federal law gives you at least 21 days to review the release (45 in a group layoff) and 7 days to change your mind after signing. Use that time, and ask before you sign.
What happens to my health insurance (COBRA)?
COBRA lets you keep your work health plan, usually for up to 18 months, but you pay the full premium plus up to a 2% fee, often several hundred dollars a month or more. Some packages cover it for a few months. Losing job-based coverage also opens a 60-day window to buy a Marketplace plan, which can cost less. The calculator adds the full premium to your spending once the covered months end.
Is PTO paid out when I'm laid off?
It depends on your state and your employer's policy. Some states require unused PTO to be paid out, and others leave it to the employer. If yours pays it out, enter the days, and the calculator values them at your daily rate.
Estimates only, not legal, tax or financial advice. Withholding uses a flat 22% federal rate plus Social Security and Medicare, with no state tax tables, so your actual tax may differ. Your numbers stay in your browser.
