401k & Pension Plan

Please help, truly desperate: I took out my 401k and pension plan last year 2008 total of $103,000 plus, I am 56 years old in 2008, CA residence and here's my concern:

1. was terminated after more than 14 years from my job on 06/19/2008
2. took out both retirement savings and paid bills
-mortgage 1st & 2nd (behind for 4 months)
-property taxes (behind & owed 2 years from 2006- 2008)
-credit cards worth $50,000 (in collection for about a year)
-paid the rest of my creditors and utility bills
3. I am getting ready to file my 2008 tax returns
*what are the tax consequences?
*penalties?
*received 3 months of unemployment insurance then was discontinued by the State, I appealed and pending results
*what are my other options to delay paying the penalties
*I do not have any money in the bank
* tried to refi twice and was rejected twice, due to my credit report
4. Yes, I was continuously looking for a job, but received only "will call you back" reply.
Please help!

Lucy,

Obviously you spend more money than you have income, and have been doing this for several years.

You need to develop a spending plan that you can afford to pay.
You should seriously consider selling your house/property and other things that you do not need to raise some cash. Perhaps any job (even Jack-In-The-Box) would be a good move for now.

You will owe regular income tax on the amount that you took from the 401k and the retirement plan. You will owe an additional 10% of the money you took from the 401k and the retirement plan.

clydewolf, thank you! I know and I sincerely regret it. I became one of the statistics that spent the money that I dont have. Starting all over again right now and mapped out a totally different road towards COLD CASH MONEY (not retirement anymore, because the word retirement does not mean what it says).

Please help, truly desperate: I took out my 401k and pension plan last year 2008 total of $103,000 plus, I am 56 years old in 2008, CA residence and here's my concern:

1. was terminated after more than 14 years from my job on 06/19/2008
2. took out both retirement savings and paid bills
-mortgage 1st & 2nd (behind for 4 months)
-property taxes (behind & owed 2 years from 2006- 2008)
-credit cards worth $50,000 (in collection for about a year)
-paid the rest of my creditors and utility bills
3. I am getting ready to file my 2008 tax returns
*what are the tax consequences?
*penalties?
*received 3 months of unemployment insurance then was discontinued by the State, I appealed and pending results
*what are my other options to delay paying the penalties
*I do not have any money in the bank
* tried to refi twice and was rejected twice, due to my credit report
4. Yes, I was continuously looking for a job, but received only "will call you back" reply.
Please help!

***
1099C not receive, can I just add

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Hello everyone, My returns are ready to go via efile.
However, I did not receive the 1099C on 2 different CCcompany. I've settled all creditcards debt using my 401K ($50,000+).

1. Can I just add the amount and the names of the CCompany,
2. I'd rather file it now, get it over with rather than owing taxes on it later
3. I already owe taxes and penalties from the $130,000+ 401k I took out in 2008, 56 yo, unemployed to keep my house. YES everyone, I chose my house rather than keeping the 401k in the bank, especially knowing the government is already eyeballing it for their own use.

Hey Clydewolf, I even sent resumes to Jackinthebox, McD's, etc etc.
NO, I have no qualms nor issue working for all of the above and
YES, I missed the corporate perks, $$$pay, new cars every 2 years, Hawaii every year, etc etc. But WHO CARES! I have my house and I am ready to roll.

"Would you like Fries with your Burger" ???

Lucy,

Did you negotiate any forgiveness of the debt? The reason I ask is because it seems that you paid it out of pocket (401k) for the full amount. A 1099-C is only issued if debt is forgiven, at which time it must be claimed as income for the forgiven amount.

If you negotiated a settlement for less than what you actually owed, you may receive a 1099-C. If you paid the maount in full, the debt is retired, not forgiven. Thus, no 1099-C will be issued.

Lucy,

Good to see you still have a sense of humor! Keep it.

Pricespector has stated it clearly, no 1099 unless there is forgiven debt.

Wish you the best.