posted on Apr, 19 2012 @ 09:13 AM
reply to post by timidgal
forgive me if anything I say is covered but I'm too lazy to read the entire post.
1. part of the money owed, I presume, is the early withdrawal penalty on the 401(k) distribution. you might be able to get that waived via
financial/medical hardship (use the disabled card).
2. you make it sound like you had no income and, yet, you're being taxed. You received taxable disability and you took money out of your pension so
you did, in fact, have income.
3. make sure your tax preparer optimized any and all education credits. tuition can result in a direcr reduction of your income or a direct credit
against the tax. your preparer should have run both scenarios to ensure you were getting the best possible treatment.
with regards to the tax bill, you can set up payment plans with the IRS as well as try and negotiate a one time settlement of the taxes, in full, for
much less than you owe. To do the latter, you need to show them that you have absolutely no means of paying them which would, obviously, depend on
your situation with work, disabiltiy, monthly cost of living and the available assets. Believe it or not, folks who attempt to deal with their debt
to the IRS are treated rather well and the IRS is well aware of the crappy economy and the hardships many people are facing.