Tax Return Question

[chloe0724]

Ok, so I filed alone, but am married. I have to turn over everything above $250 to the judge. I called the Trustee's office to ask if my husband's portion of the return would be exempt and she said no. She said that even though he didn't file, he is benefiting from the BK becasue he benefitied fro the cards I am discharging. It does make sense. I was wondering if anyone else filed alone and has this issue. What if we file seperatly?

[filingin08]

I don't have an answer, sorry, but just curious, could you file seperately and then turn over your tax return, he keep his? Better yet, up your exemptions so you get nothing back (no help for 2008).

[woeisme]

My understanding is that your entire household disposable income is to be included in your CH 13 plan, regardless of whether you file alone or joint. So the trustee's office is right, your husband's portion is disposable income in their eyes, which belongs to them. Sorry. My trustee is much nicer and allows us to keep our tax returns as long as they are under $6500, not a measly $250.

[ltrain823]

I plan on being married in the next 3 years...do the trustees take it every year or just within the first 5 years of payment?

[woeisme]

After 5 years your BK plan is complete, so the trustee won't take any other money after that. It really varies from trustee to trustee, some don't take tax returns, some do, and of those that do, they all seem to have different thresholds after which they take the $, so inquire with your lawyer so you can be sure to adjust your holdings accordingly so they won't be taking much if anything. Even tho my trustee allows us to keep up to $6500, I still changed my W-4 form just so we'd have more monthly take-home to survive the CH 13. Not sure how much we'll get back this year, but will be significantly less than last year (which was $4000), probably less than a thousand.

[ltrain823]

So this is going to be my first year in the BK and getting a tax return and I'm just curious to know what the process is with a trustee that does want all of it. Does the government send the check to the trustee or to me as usual? Do I have to deposit it and then send a check to the trustee? How does the trustee get the money?

Also, does the trustee get in contact with you or something? I'm just completely confused about the whole tax return thing and how it works. Can anyone please share...thank you

[woeisme]

At your 341, your trustee or lawyer should have told you what you needed to do about your tax return. I assume they told you that anything over $250 had to be turned in to them, from your original post. In my case, the trustee said the only thing I had to do different from normal tax years was that I was not allowed to do electronic deposit of my return (where it'd go straight to my bank account) that it had to be an actual check. Now since my check was under his "allowed" amount, I was just able to cash and keep it. If it had been above the amount, I would have had to send the trustee a payment for the amount over the allowance (in your case, for the amount over $250). The government has your tax returns already "flagged" due to your CH 13 BK status, so the trustee will know if you get a return and for how much, so if you don't send in what you are required to, they will eventually begin proceedings to dismiss your case.

[ltrain823]

i had my 341 meeting last month and my confirmation meeting is jan 28th...my trustee didnt say anything about tax returns so I am unsure...should i ask my atty?

[woeisme]

Definitely ask your attorney. That's what they are getting paid for!