Looks like I owe the IRS $20.000 for becoming disabled.
→[More:] Because Social Security took 4 years to decide my case, they owed me 4 years of benefits which they paid in a lump sum in 2008. Since 2004, my private disability company paid me a monthly benefit to cover the time waiting for Social Security with the expectation that I would repay the overpayment once I received the lump sum.
However, I did not receive the bill from my private insurance company until last week (2009), so I cannot apply my payment as a deduction for 2008, and therefore because the lump sum is over the IRS maximum for Social Security benefits, I will have to pay taxes on virtally the entire amount. Of course, I don't have this, because I sent it to my private insurance company.
The real kicker: although I can apply the payment toward 2009 benefit income, just by themselves they won't be taxable anyway. Finally, my private insurance company included the benefits paid to my exwife for our son in my overpayment. Ordinarily, that benefit is not taxable but because my private insurance company includes this in my overpayment, it was reported as income and I paid taxes on it anyway, despite that my exwife receives it, and if anyone were to pay taxes on it, it would be her.