For those you received severance checks in 2015, this could affect you when you prepare your 2015 IRS Form 1040 tax return. Please don't be over alarmed when you get to Line 42 (Exemptions. If line 38 is $154,950 or less, multiply $4,000 by the number on line 6d. Otherwise, see instructions.)
In my case, I had worked for a good part of the 2015 year and was terminated with a severance check equivalent to 1 year of annualized pay. Line 38 (Adjusted Gross Income) on my IRS 1040 tax return was over $154,950. I freaked for a while thinking I would lose out on the $4,000 per exemption ($8,000 in my case).
I looked up the Form 1040 instructions to see how to deal with Line 42 (Exemptions), and was still a bit confused with completing the worksheet. The solutions is to lookup "Publication 17" on the same IRS.gov website. There you will be able to understand a lot easier on page 25 that it covers Exemption amounts in better detail. The amount you can deduct for each exemption has increased. It was $3,950 for 2014. It is $4,000 for 2015.
IMPORTANT: Exemption phase-out. You lose at least part of the benefit of your exemptions if your adjusted gross income is more than a certain amount. For 2015, this amount is:
$154,950 for a married individual filing a separate return;
$258,250 for a single individual;
$284,050 for a head of household; and
$309,900 for married individuals filing jointly or a qualifying widow(er).
Please copy and paste this post to a word document and file it in your 2015 Tax folder as a reminder. Don't fail to take the Exemptions you are entitled to under the IRS rules.