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Personal Finance and Investing

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Tuesday Afternoon

(56,912 posts)
Sat Feb 25, 2012, 12:59 AM Feb 2012

Tax question regarding Disability Settlement and IRA withdrawl [View all]

within the same year (2011)

Person receives settlement last Feb....... = 11K
Person withdrew from IRA.....................= 7K
Person rec. mthly disability total for yr.....=18K

total income for year = 36K

This person is single head of household with no children. Person has brain damage and is not cooperative.

Does this person need to file a tax return for 2011?

Keep advising this person to talk with a tax person. This has been a conversation ender.

Will this person have to pay taxes and penalties for early withdrawl from that IRA?

Will this person have to pay taxes on any disability earnings?

Thanks for any help just to ease my mind I hope this person does not have to file this year. Very combative about all this.

on edit: After reading this thread- http://www.democraticunderground.com/112167

I have come to the conclusion that this person may be able to claim another person as a dependent... this other person does NOT live in the same household, if that makes a difference... ??

6 replies = new reply since forum marked as read
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If officially dis abled usually no penalties Angry Dragon Feb 2012 #1
just to clarify: Tuesday Afternoon Feb 2012 #2
Taxable but no penalty Angry Dragon Feb 2012 #3
to understand ... this person Tuesday Afternoon Feb 2012 #4
I believe this person will have to file a return Angry Dragon Feb 2012 #5
ok. thank you. Tuesday Afternoon Feb 2012 #6
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