So is the amount of the total income from the company the same as what you got and what was reported? You say it is, so that should not be a problem. So lets walk through the severance part of the question. When she got paid severance, was all the withholdings taken off? It seems you indicate there would of been withholdings. When she paid back the severance, did she have to pay it back in whole or just the amount that was take home pay? If the whole severence was paid back, that had withholdings on it before, then you should receive that massive refund rightfully. If she only paid back what was take home pay, I also assume that withholdings were held at the normal levels as before, I would inquire with the payroll department as to what happened with the withholdings of the severance. If they were refunded the withholdings, then I would ask if they could give a corrected W-2. If they were not refunded the withholdings, I would as why they were not. I would push to have the right thing done, because any refund that is not rightfully yours, the IRS can come back, bill you what was suppose to be theres, plus interest and penalty.
