I received a $20K settlement in 2016 (after lawyers fees & whatnot - it was originally $100K, and there was another person I had to split the money with) from the state due to a traumatic event that had happened to me at no fault of mine, and had honestly thought that taxes and everything had been taken out. I've never had such a sum of money in my life, so I used the entire amount to pay off my car and three of my student loans (I had five student loans total).
But eventually, I received a notice in the mail that an audit was done and I owe just over $12K on my taxes for that money (including a penalty fee). It had never entered my head that I needed to include that when filing my taxes, I didn't even get a W-2 for it, so I didn't think about it and filed as I always did.
I honestly am freaking out. I haven't really done anything about it yet, but will be going to the IRS website to set up a payment plan. I have clinical depression, and I've been putting off doing this because I honestly don't know what to do, and I have a bad habit of avoiding things. I make $11 an hour as an admin assistant, and everything I make goes to my remaining two student loans, bills and my car (the one I had paid off previously was a total loss after a wreck caused by an uninsured driver). I still live at home with my mom, because I can't afford to live anywhere else (I'm 28).
Has anyone here owed such an amount to the IRS before? How did the payment plan work for you - can you choose your amount? Can you pay it indefinitely until it's paid off? There's no way I can pay this amount in 60 or 120 days (which I think are two of the options on their website), so I'll have to go with their high interest monthly payment option, which will add a one-time $149 fee to my balance.
I suppose I'd just like some idea on the process, because this is all so new to me. Every time I think about it, I start crying. I'd have rather not received the money I'd gotten at all. Should I just put my student loans on hold to pay this? I'll be paying them for the rest of my life anyway.
Submitted March 19, 2018 at 11:41AM by abhivanth http://ift.tt/2FSlIzS
