Disability and Taxes

[sleepwalking]

Appologies if someone already started a thread on this topic and I can't find it.

I am so foggy. I need to do my taxes and am having so much trouble getting started.

I have a question if someone can help me....

I finally won my SSD last June and now I have to pay taxes on all the back pay and it seems I also have to pay taxes on the money that I never saw. $5500 went directly to my attorney from SS. Another large chunk went directly to the State to pay them back for the year that I was on State disability.

How come I have to claim that part that went to the State as income? That was reported on my taxes in 2006. My old taxes are buried in a storage unit and I can't access them, so I'm not sure how that money was reported in 2006.

Does anyone know about the state part? Thanks for any help.

 

[SeaShel]

sleep, the state part is going to vary state to state.

You may find that even with the back pay, you don't really owe, but many things come into play. Your filing status, other deductions (mortgage, medical), etc.

When I was single, I ended up getting a letter from the IRS telling me to quit wasting their time filing because I didn't need to. I was collecting social security disability and on a private LTD policy, and it wasn't enough to owe tax on.

I'm afraid there isn't a blanket answer to your question. When you're having a decent day, you might want to give one of the free (federal) online tax prep software a try and see if that can help you figure out where you stand. Some states have it and others don't.

I think there's also a way to access old returns online now, google it and check. We had to do something like that for my son.

Good luck, and don't worry too much right now, you might be fine.

Shelley

 

[leelaplay]

hi sleep - yuck - taxes are hard enough at the best of times.

Some disability groups have people to help you with your taxes for free here in Canada. I never had the oomph to track them down and find them, but maybe there's someone convenient for you?

good luck

 

[SeaShel]

Free tax help for disabled:

www.vita-volunteers.org

 

[Sunday]

Great resources. If it's a state issue, you might also try calling your state's 800 tax advice number, or going online to get an answer there, sometimes they have chat. A tax program would probably clarify that also and make doing the rest of your taxes easier. They red-flag stuff that might raise eyebrows at the IRS, so you can turn in a nice dull return that won't cause any ructions. The programs aren't expensive, or you may know someone who will let you use theirs (my fortunate position).