How does the hardship penalties work? I've been in the hospital 14/12 months up to or more than 2 weeks. I've got lawyers filing a disability appeal for me now. I need more insight into this issue. I know I'm going to lose a lot for withdraws , just trying to wrap my head around how this all works.

Ask the lawyers to connect you with a competent tax professional. There are a variety of factors in determining whether you qualify for relief of early withdrawal penalties due to hardship.

You probably qualify, but it is hard to tell given the brevity of your post.

Withdrawal from what? IRA? 401(k)? Another type of retirement plan?

Also tell us your age, and also whether you are considering a withdrawal from a retirement plan due to disability, or for medical payments. And if for medical - are your out-of-pocket medical expenses likely to be greater than 7-1/2% of your adjusted gross income?