- We are going to need the money to live on when we move back east as I will not be able to work due to care for my husband. When I get it deposited to our bank acct, I will need to take the majority out right away to pay for rent/medical bills/ect. This will basically be the money we will be living on for at least 1+ years and can't risk a bank account levy. If I receive the lump sum and then take it out of the bank account right away with the intent to live on it, is that considered tax evasion?========>>>>>>>>>unfortunately yes ; You should receive a Form 1099-R from the payer of the lump-sum distribution showing your taxable distribution and the amount eligible for capital gain treatment. the payer also reports it to the IRS.
You may defer tax on all or part of a lump–sum distribution by requesting that your employer directly roll over the taxable portion into an Individual Retirement Arrangement or to an eligible retirement plan. You can also defer tax on a distribution paid to you by rolling over the taxable amount to an IRA within 60 days after receipt of the distribution. A rollover, however, eliminates the possibility of any future special tax treatment of the distribution. Mandatory income tax withholding of 20% applies to most taxable distributions paid directly to you in a lump-sum from employer retirement plans regardless of whether you plan to roll over the taxable amount within 60 days. If you put any of your own after-tax contributions into any of the accounts, then that portion is considered non-taxable. You put the total amount of all retirement distributions on 1040 line 16a, and then subtract off any after-tax contributions you made, and the taxable amount goes on line 16b
I would still pursue payment options with the IRS -- not trying to get out of our obligation -- but we will need to have money to live on, and we can still pursue payment arrangements after the May 1 disbursement. Don't want to get tagged for tax evasion though.=======>>>>>>>>I guess you need to contact irs for help; even if you're ineligible for an online payment agreement, you can still pay in installments by completing and mailing Form 9465 and Form 433-F;you may call 800-829-1040 or the phone number on your bill or notice. Please visit the website.Taxpayer Advocate Service
Also, Are there any other options?====.>>>>>>>>>. I guess as mentioned above.