To get it to work I had to change the PHP support to CGI Application instead of FastCGI and can now open the add new post on admin panel. Not sure why I would have to do this but from what i read most Internal server errors are theme/plugin coding errors and memory limits…… I know my memory limits are correct so leaves coding…..i assume since your linux only there is something coded in there to cause an issue with FastCGI.

Thought I would throw that out to anyone else on AWS Server 2012 R2 with Plesk 12.