Participant's last day of work is in 12/2001; however he is receiving severence pay until 4/2002. Would his termination date then be 4/2002 or the last day he worked?

What does the plan say?

The determination of "severance date" is usually a personnel matter, not a definition in the plan. However, Kirk's point is to look at the plan definition of compensation for a possible reference to severance pay.

I would also say - how is the employer reporting the severance for tax purposes - all in the 2001 W-2 or will the employee receive a W-2 in 2002 for the 4 months of severance?

This is not an answer but as additional question. Generally entitlement to benefits is subject to an hour worked condition. Is the real question if hours need to be credited? If not the "termination date" becomes irrelavent, .. doesn't it?

The termination date is relevant for other things, such as the determination of average compensation in a DB context, the "last day employment requirement" in a DC plan, and application of changes in plan provisions as well in any type of plan.

I've struggled with this issue as well.