My suggestions (and not legal advice) are:
First, you can and should answer the letter within any time frame specified in the letter even if the only answer you have is to say that you are still working on determining if you do, or do not, agree that you owe additional tax.
Second, you can and should get your husband to understand since he signed the return that he is very likely jointly and separately liable for any underpayment on the return if he knew (or should have known) that you got the $10,000 from the IRA when he signed the return. That is, whether or not he would like to pay additional tax that it is indeed his liability as well as yours. In fact, most times both spouses will separately receive the same notice of any proposed changes to a joint return. This may be best done along with the third item.
Third, you can and should determine that you indeed are liable for the proposed addition to tax (as it seems you may be since you admit you "forgot" to report the income). For this you may want to employ a tax practitioner to review your 2007 return to see if there are any other items that need to be changed and to verify the computations made by the Internal Revenue Service
Fourth, once you determine the amount of additional tax that you indeed do owe for 2007 you can and should request abatement of penalty if you can show any reasonable cause for not including the amount on the original return. An experienced representative may also be useful in this task.
Fifth, if you do agree that you owe additional tax and can not currently pay the full amount you can and should consider an installment payment agreement or other options (such as offer in compromise or being placed in not currently collectible status) for you to avoid collection action. Again, an experienced representative may be useful to explore your options.
You will have to decide whether you will pursue these actions with or without representation. Only attorneys, CPAs and Enrolled Agents (EAs) can represent taxpayers before the IRS on these types of matters. If you used a preparer for the 2007 tax return that person can represent you (at least in part)even if he is not an attorney, CPA or Enrolled Agent.
As an Enrolled Agent, my biased opinion is that representation will be valuable in this matter. You can find an EA in your area by searching at https://portal.naeacentral.org/webportal/buyersguide/professionalsearch.aspx
Most representatives will meet with you to discuss your case and the services that they can provide at little or no cost.
I hope this helps for some suggestions of what you can do.