Just to add - the 10% federal withholding might not be enough depending on your total income for the year and tax bracket. If you had a good job before unemployment you might want to consider making quarterly payments instead of just relying on the 10% withholding option.

ugh the whole tax thing with unemployment is so confusing, why can't they just make it simple like regular payroll taxes

Just went through this same situation with my partner last month! The key thing is to definitely keep filing and report the severance under "other income" when you certify. What helped us was calling it exactly what it is - "severance pay" in the description field. NY DOL is pretty good about calculating how it affects your weekly benefit amount automatically once you report it properly. One thing I wish someone had told me earlier: if the severance was paid as a lump sum, they typically spread it out over the weeks it was meant to cover (like if it was 4 weeks severance, they divide it by 4). But if you're not sure how they calculate it, definitely worth getting someone on the phone to clarify. The main thing is just be transparent about it. I know the forms can be confusing, but it's way better to over-report than under-report with this stuff. Your spouse is smart to ask questions rather than just wing it! Keep all the paperwork from the severance too - you'll probably need it if they ever do a review of the claim later on.

I just want to echo what everyone else is saying - definitely report the severance! I made the mistake of not reporting mine right away when I first got laid off because I wasn't sure if it counted as "income" since it was technically from my old job. Big mistake! The DOL caught it during their quarterly wage crosscheck (they match up with employers) and I had to pay back like $800 in overpayments. Plus they hit me with a penalty week where I couldn't collect at all. Not fun. The good news is that once I started reporting everything properly, the process was actually pretty smooth. They have a specific field for severance/separation pay when you certify, and the system automatically calculates how it affects your weekly benefit. Pro tip: if the severance amount seems like it's going to wipe out your benefits for several weeks, you might want to call and ask about "allocation" - sometimes they can spread it out differently depending on how your employer structured it. But honestly, the phone wait times are brutal, so only do that if you're talking about a really big severance package. Your spouse is being smart by asking first. Better to be cautious with this stuff than deal with the headache later! 👍

THE WHOLE SYSTEM IS DESIGNED TO SCREW SMALL BUSINESSES! They make it impossible to get straight answers about your tax rates and then hit you with massive increases. We had THREE claims last year and our rate went up 40%!

Wait, so if I get laid off and file for unemployment, my former employer gets punished financially? That makes me feel kind of bad about filing... should I not apply for benefits?

Quick update on this issue - I've been handling NY unemployment claims for years, and there's actually been a rise in these "phantom forfeit days" since the system upgrade in February 2025. If you're experiencing this, specifically request that the agent check the "Penalty Enforcement and Resolution System" (PERS) database, not just the regular claims system. They need to do a cross-reference to identify duplicate penalty applications. The backpay is automatically processed once the duplicate is confirmed and removed.

Just wanted to follow up - were you able to get through to them? If you're still having trouble reaching someone, that Claimyr service I mentioned really did save me days of frustration. The agent I spoke with said they're seeing this forfeit day issue a lot lately and have a specific protocol for fixing it now.

Good luck with everything! I hope it works out for you. Being terminated is stressful enough without worrying about benefits too.

I went through something similar when I got terminated from my retail job for what they called "performance issues" but was really just me having a hard time during a family emergency. I was so worried I wouldn't qualify for benefits, but I applied anyway and got approved after about 3 weeks. The NYS Department of Labor really does look at the whole picture - they're not just trying to deny everyone. Since you have doctor's notes for most of your sick days, that's going to help your case a lot. Don't let the stress keep you from applying right away. The worst they can say is no, but you might be surprised. Also keep all your documentation organized in case they need it during the review process.