Taylor was offered the role of 'Head of Football' whilst Peter Reid and Steve MacLaren was also rumoured to be lined up for the job - but the former Molineux manager turned down the role despite being 'flattered' at being offered a position at Bramall Lane.
"It was something that I was very interested in when Kevin first approached me but, having discussed the matter at length with my wife, we've come to the conclusion that it is best for both parties if I don't proceed.
"I started in management very early because of injury and since then I've discovered there is a life outside of football. I still do a lot of work in the game but I've also got many interests outside of it too which aren't reported.
"If I had've taken the job at United then I would have committed to it totally but that would have meant that I would have had to give those other things up and there would have been no going back to them.
"Maybe I'm a bit old fashioned but I don't think I could have taken the job and continued to live in Birmingham.
"Kevin would've probably said it was okay but I feel that if you're at a club you have to be a part of the community.
"I'm flattered to have been considered and it's a wonderful job at a wonderful football club.
"But if I can't commit totally I think this is the best thing for both of us. I wish United all the best for the future though."