Taxes on an early pension payout...?

I took an early pension payout when I left my job after 11 years. Instead of reinvesting the money I used it to pay off all my bills except my vehicle, i.e. credit cards, late doctor/hospital bills, etc. I paid state and federal taxes on the money before it was ever given to me, and I paid a penalty for early withdrawal. On my taxes the next year, the sum I was actually paid was added to my taxable income, throwing me into a higher tax bracket as a single person and now I owe the IRS big time. I am confused as to how this is not taxing the same money twice. I added up the total tax on the pension money and if correct my portion of that money that I worked for would have ended up being $1,500.00 (the pension was only $23,600.00 and I ended up with a little over $16,000.00 when they took the first set of taxes out). I had a certified account do my taxes for me but I think there must be a mistake somewhere. Can anyone shed some light on this for me?