The network offered little explanation at the time, but TMZ reported Saturday that the 38-year-old actor was asked to leave when his 20-year-old co-star Hunter King told executives that he had "fondled her breasts" and bullied her.
Sources told the gossip site that King's accusations were the last straw for an actor that had long caused problems on the set.
Muhney announced his departure from the show on Twitter last month.
"I'm so sorry. It breaks my heart to say this, but I was just let go from Y&R. My last day on set is this Thursday," he wrote. "My last air date will be Jan 30th. I'm going to take some private time with my wife & kids, as I am most concerned for their well-being. I have 3 final episodes to film, and because they are my last, I will be giving it everything I have."
Muhney said later in an interview that the firing left him "speechless."
"Part of me feels this is because I've always been outspoken, and sometimes I've been too outspoken. Sometimes I've walked around with a big backpack full of hubris," he said. "It was explained to me that CBS and Sony want to give [my character] Adam a break for 3-6 months and then they'll bring him back with a different actor."
He also addressed questions about his tense relationship with former co-star Eric Braeden.
"I'll apologize for when my character bled into my real life at times and if I was intense a few times," he said. "But I'll let everyone know how blessed and honored I was that I got to work with them all."