Last year (2006) I withdrew all of my 401 k from my former employer. How do I account for this in filing my taxes and how does the 10% early withdrawel get factored in. The company already withheld 20%

The 20% is ONLY a down payment on the tax you will owe. It will be a big bill, as you are taxed at your marginal tax rate, PLUS state income taxes, plus a 10% Early Withdrawal Tax that CANNOT be mitigated.

Tell me, WHY did you withdraw the money instead of rolling it over into an IRA?

Your company should have sent you a 1099R form with the value of the distribution. That amount is entered on your tax return and added to your total taxable income. That total is then used to calculate your tax liability.

As ATE pointed the 20% withholding is only a withholding. Its not the amount of tax.