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Bank Levy? This makes no sense to me

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  • #91
    Originally posted by Maria80386 View Post
    You can always file an amended return. Before you do, run the calculations in TurboTax. Perhaps the 20% tax withheld was reduced by other amounts, thus the 10% penalty was included elsewhere, or, the entire amount may not be taxable. You may also be able to explain the need for the hardship withdrawal and have the penalty waived, for example, the last withdrawal I had to do was to pay a $15,000 cash up front surgery bill.

    You can send the IRS a request for tax transcripts. Those will show all the form 1099s and W-2s and other forms they received. It might provide information negating the worry. Or, show that you need to take action.

    One good thing about a bk, or planning for one, is you finally get to face your economic reality. I stopped fretting about $100,000 owed ago.
    The thing is though it's too far back to amend. I gotta call up the IRS and see if any notices were sent out. It sucks enough that my mail has been lost so many times in the past, even at my old apartment back in NY.

    It's really crazy how financial matters can mentally cripple you in pain. Haven't been this stressed in my entire life. Even though I just found a decent paying job, I feel like just up and leaving going back to NY. I'm emotionally wrecked. The thing that's really got me keeping my faith in Jesus Christ is the small signs he keeps showing me daily. He keeps showing me small signs here and there, letting me know he is helping me. Showing me signs that I'm supposed to be where I'm at exactly to this day, with all the problems I've made for myself. Maybe it's a lesson, or maybe punishment for occasionally doubting him in the past especially after so many family deaths.

    On a lighter note, after realizing that not filing tax info can lead to tax evasion charges....I said to myself, hey, I'll take 5 years in prison....now bills to pay! Lol of coarse I don't want that, but I have to make myself laugh in this crazy period in my life. Glad I got people to talk to over on these forums!

    Comment


    • #92
      As far as I know, loans are not taxable. At least I never paid tax on a loan that I was repaying to a 401(k). That said, distributions may be taxable (such as a hardship withdrawal). I guess it depends on what code is in the box on the 1099-R. I don't think I ever received a 1099-R for a 401(k) loan, but I have received it for a withdrawal.
      Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
      Status: (Auto) Discharged and Closed! 5/10
      Visit My BKForum Blog: justbroke's Blog


      I am not an attorney. Any advice provided is not legal advice.

      Comment


      • #93
        Originally posted by justbroke View Post
        As far as I know, loans are not taxable. At least I never paid tax on a loan that I was repaying to a 401(k). That said, distributions may be taxable (such as a hardship withdrawal). I guess it depends on what code is in the box on the 1099-R. I don't think I ever received a 1099-R for a 401(k) loan, but I have received it for a withdrawal.
        Agreed. We have used I think three 401k loans over the past several years. We have never paid taxes or a penalty for this. The hardship withdrawals we took this year to pay for my tuition, definitely are taxed and I'm not sure about the penalty yet. But it would not surprise me to pay one.

        I think it is even listed on the Merrill Lynch site as a benefit of taking a loan versus a withdrawal, that you do not have taxes and penalties. Trevor, were these loans or were these actual withdrawals? Did you pay them back over time, did they take payments out of your checks?

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        • #94
          Originally posted by Chrysalis View Post

          Agreed. We have used I think three 401k loans over the past several years. We have never paid taxes or a penalty for this. The hardship withdrawals we took this year to pay for my tuition, definitely are taxed and I'm not sure about the penalty yet. But it would not surprise me to pay one.

          I think it is even listed on the Merrill Lynch site as a benefit of taking a loan versus a withdrawal, that you do not have taxes and penalties. Trevor, were these loans or were these actual withdrawals? Did you pay them back over time, did they take payments out of your checks?
          The ones back then were loans, the 2013/2014 ones. Actually I'm pretty sure most of them were. But when I left in February 2017 I cashed out my Pension and 401K. When I cashed out, I had like 3 current loans being payed off, I don't know exactly how those were finalized/payed?

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          • #95
            Originally posted by Trevor View Post

            The ones back then were loans, the 2013/2014 ones. Actually I'm pretty sure most of them were. But when I left in February 2017 I cashed out my Pension and 401K. When I cashed out, I had like 3 current loans being payed off, I don't know exactly how those were finalized/payed?
            Ah, I see now. At the moment your 401k was liquidated, the remaining balance on those loans became withdrawals and were therefore taxed & penalized as such. That makes sense.

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            • #96
              Exactly what Chrysalis mentions... the loans were defaulted and were then treated as a withdrawal per the IRS rules.
              Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
              Status: (Auto) Discharged and Closed! 5/10
              Visit My BKForum Blog: justbroke's Blog


              I am not an attorney. Any advice provided is not legal advice.

              Comment


              • #97
                Ok at least I know Federal 20% was taken out. It's just that the 10% early penalty might bite me in the behind eventually because I didn't file them with the 2013/14 returns. I checked my old W2's...yikes. I'll MAKE SURE to square away my 2017 taxes because again that was a huge chunk I took out, cashed out etc. I tried the irs website to register, and to change my address, but it failed after three times. I read you can just put your new address on my upcoming filing to correct it.

                Comment


                • #98
                  The Federal 20% is a requirement for withholding. It doesn't mean that 20% of the amount is the total tax on that amount. It's just an estimate. Your tax might be 35%, 15%, or even 0%. The penalty might be waived in certain cases. You won't really know if there could be an amount owing unless you pull up your old files and recalculate, or ask for a tax transcript.

                  The IRS has a few years, ten I think, to decide to audit your return, more if they suspect hanky-panky.

                  After you've researched what happened, you might also look to see if there was an unused credit or deduction you could have taken that would have mitigated the tax and penalty, such as job hunting expenses, moving expenses, and so on.

                  If you are really stuck in a bind, the IRS taxpayer advocate has been extremely helpful to me, especially in CA and AZ. And, when all else made no sense, the actualagent in the IRS office was able to make the system work as designed and get problems solved.

                  There are multiple resources to alleviate the issue. Good luck and stay dry. We're currently flooded up north.

                  Comment


                  • Trevor
                    Trevor commented
                    Editing a comment
                    Thank you Maria! Great info. YES Phoenix got drenched tonight. Where you at, Flagstaff?

                • #99
                  North of Carefree. The good news is the water dropped fairly quickly.

                  Glad to be of some help. Between you and the rest of the forum, both of us just might dig ourselves out.

                  Comment


                  • I wanted to ask you folks here instead of opening a new thread. Thank God I was able to get my old job back, and I start the end of this month. Now, I have another opportunity, but I just don't know which path to take. To give a quick run down of each job, here goes.....which would you pick.

                    AT&T (start end of this month) this was my previous job of 10 years.

                    -Guaranteed yearly of $50-60k yr plus overtime
                    -Union backed, so there's great job security there. You literally have to miss quota about 3 months in a row to even be looked at to get fired.
                    -Discount on direcTV/phone service
                    -GREAT healthcare and 401K
                    -After a year I can transfer back to NY and FINALLY BE BACK HOME and have my job!!!!!
                    -I have seniority, so I can pick my schedule/days off etc
                    -$17.27hr pay, so even on a slow day I'm still making decent money
                    -Retail hours, earliest being 9am.

                    Dish (inside sales rep/incoming over the phone sales) -My interview is this Tuesday, the hiring manager said I pretty much have the job 99% because they liked my phone interview/voice etc lol.

                    -Average salary with commission is around $47-55k yr. TOP performers are over $100,000 yr!!!
                    -Only 12.50 hr so you HAVE TO sell to make $$$$
                    -Good benefits, from what I've read, most people complain that the benefits package aren't good. 401K also
                    -Really early hours 5am start, most times 7am. You can pick 4 day work week or 5
                    -Discount on Dish services
                    -EASY to get fired! I was reading reviews on Indeed and apparently if you can get canned very easily depending on sales
                    -No way to transfer back to NY
                    -The chance to make a ton of money...but again I'm skeptical, I never did over-the-phone sales full time.

                    So basically it's either a guaranteed job with security, and I know the ropes......OR a shot in the dark. A "what if" chance. Both jobs are 30-45 minutes away all highway miles.

                    Comment


                    • AT&T. It sounds to me like you really need to get back home with your people.

                      Comment


                      • Originally posted by Chrysalis View Post
                        AT&T. It sounds to me like you really need to get back home with your people.
                        Thank You! It's not only my friends and family, I even miss the Chinese food and pizza in NY/long island lol.

                        The job with Dish has me tempted, because even in the employee reviews, they say the money is GREAT as long as you can handle the sales/pressure. Most reps make $80k yr but again top reps are over $100k yr.

                        I would have to become "The Wolf of Wall street" lol, that type of sales guy.

                        Comment


                        • Stay far away from Dish Network. I have friends who have worked for them, in precisely this position, and none of them stayed very long. It is a high pressure, high turnover work environment. Also, the product itself (satellite TV service) is a tough sell in an oversaturated market. Do not let yourself be lured in by the promises of what "top performers" supposedly earn. It is possible you won't even keep the job, or will end up miserable--and making a lot less.

                          Comment


                          • Originally posted by bcohen View Post
                            Stay far away from Dish Network. I have friends who have worked for them, in precisely this position, and none of them stayed very long. It is a high pressure, high turnover work environment. Also, the product itself (satellite TV service) is a tough sell in an oversaturated market. Do not let yourself be lured in by the promises of what "top performers" supposedly earn. It is possible you won't even keep the job, or will end up miserable--and making a lot less.
                            Yes thanks! I must have read through 300 reviews already on glassdoor and indeed. I'm going to cancel my interview, or maybe I'll just go in and do this......LOL!!!!

                            Watch till the end!!!

                            https://www.youtube.com/watch?v=YnXPGF0pvJU

                            Comment


                            • Guys just a question, I looked through this thread quickly because I thought I already asked but didn't..unless I missed it.

                              I just took out $3,000 cash out of my checking, just to keep hidden in my apartment as a small emergency fallback. Let's say I wind up filing Chapter 7 4-6 months from now, will the Trustee want statements going back that far?

                              Comment

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