Client's Former Employer Shortcuts on Paying Back Severance Pay

[TheTaxMan]

One of my clients battled with his former employer on the amount of severance pay he was due.

He hired an attorney and after negotiations the company finally paid my client what he wanted in the first place.

The problem is that the former employer did not run the payment through their payroll and issue her a W-2.

They simply cut a check from A/P. They did not even (even though it still would have been incorrect) issued her a 1099 for the payment.

Go ahead and report the amount on a 4852?

Thank you.

[veritas]

I don't know what you mean by form 4852.

I would report the income as wages and include on from 4137 to pay in fica tax.

[S T]

Me also

I think I would also report as wages and use the 4137 form. Not fair for the employee to pay SE tax on the whole amount. Employee would be responsible for his half of the FICA/Mcare regardless.

I would certainly provide as much info as possible, the employer needs to be responsible for their share of the FICA/MCare/ and State.

Sandy