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02-04-2009, 11:01 AM
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#1 |
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Registered User
Join Date: Feb 2009
Posts: 6
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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! |
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02-04-2009, 03:38 PM
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#2 |
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Registered User
Join Date: Oct 2001
Posts: 1,586
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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. |
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02-06-2009, 10:54 AM
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#3 |
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Registered User
Join Date: Feb 2009
Posts: 6
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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).
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02-10-2009, 10:04 AM
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#4 | |
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Registered User
Join Date: Feb 2009
Posts: 6
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Quote:
*** 1099C not receive, can I just add -------------------------------------------------------------------------------- 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" ??? |
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02-10-2009, 12:43 PM
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#5 |
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Registered User
Join Date: Mar 2004
Location: New York
Posts: 1,351
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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. |
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02-10-2009, 02:02 PM
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#6 |
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Registered User
Join Date: Oct 2001
Posts: 1,586
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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. |
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