Question on turning over tax return

[jddolfan]

How does the trustee get your tax refund? Do you have to turn it over?

I am currently pending the 6500 home buyers tax credit, 5000 of which I need for the down payment on a house I bought on contract. After turning this over, plus future tax returns and my 5 yrs of payments, I am almost paying everything back.

I am thinking about just letting my case dismiss and negotiate settlements. Even with the tax consequences I think I am better off. I do have a couple attorneys that were close to filing a law suit but think I can call them and offer a settlement.

What do you think? Thanks for you advice in advance!

[CCB35]

tax returns depend on the trustee-i have heard some trustees want it all,some or even none.In my case in Northeast Tn,my trustee lets us keep anything under $1500 .When this started she sent an order to the irs to intercept all tax returns and they send it to her and after an extra month or so she sends me a check for the amount under $1500 .anything over that goes into the plan to pay more for the creditors.
the bright side is -if you are on a 100%plan it may get you out of the plan a little earlier

[enginegirl]

my trustee wants every single extra penny that I may make over the next 5 years (all Pay increases, Tax refunds, bonuses).... I am assuming that it is because I am NOT paying 100% of the debit back. it is what it is...

If you are paying 100% of it back she/he may not require.... every trustee is different..... remember they are human so perhaps your atty can explain to her/him what you are doing and she/he may be ok with it if the payments are less than your current rent and she able to get more money for your debtors ...... remember that you have to get any major new debit approved by trustee and a mortgage would most definitely fall into this category (another question... Have you already qualified for a mortgage with a new chap 13 and bad credit score? I thought those days were over!!)

[jange]

Requesting tax returns and tax refunds is case and district specific. My attorney told me the trustee has the right to ask for tax returns but rarely if ever does.

confirmed 7 22 2010

[jddolfan]

I bought the house on contract, no mortgage lender involved, straight from the builder. My new mortgage payment is in the plan. I am letting my old house go.
.
I think i am better off doing debt settlements, I am not paying 100% back though

[NowImDownInIt]

Just be careful. Don't do "debt consolidation", they are incredibly risky and your credit has already taken a huge hit with the BK. If you want credit again in the next several years this might be a bad idea.

Did your trustee specifically say they want your refunds? Mine doesn't, nor does he ask for any one-time or seasonal bonuses. This might be because I am at 100%, but I know of many others on here that don't have to hand it over.

I would hate to see all the money I've paid into this go down the drain, and I don't know how long you've been in your plan, but all that you've paid will be money lost. Is that worth a tax refund to you?

[enginegirl]

Did your trustee specifically say they want your refunds? Mine doesn't, nor does he ask for any one-time or seasonal bonuses.

unfortunately yes.. she wants it all..... every single penny of every piece of anything that may add to my DMI..... I surprised she didn't ask for my left ovary while she was at it..... ;(

[NowImDownInIt]

unfortunately yes.. she wants it all..... every single penny of every piece of anything that may add to my DMI..... I surprised she didn't ask for my left ovary while she was at it..... ;(

Ah, that question was for the OP, but regardless, that just stinks. Any cushion in your plan at all? I know when I started I had pretty much none, but I cut certain perks from certain areas in my budget and it helped a lot. Best places for that are groceries and cell/cable service.

[jddolfan]

Just be careful. Don't do "debt consolidation", they are incredibly risky and your credit has already taken a huge hit with the BK. If you want credit again in the next several years this might be a bad idea.

Did your trustee specifically say they want your refunds? Mine doesn't, nor does he ask for any one-time or seasonal bonuses. This might be because I am at 100%, but I know of many others on here that don't have to hand it over.

I would hate to see all the money I've paid into this go down the drain, and I don't know how long you've been in your plan, but all that you've paid will be money lost. Is that worth a tax refund to you?

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I have my trustee meeting next week so just having to start payments. There is one reputeable company in Iowa for debt consolidation but I work in the financial industry so I know how to negotiate with these guys.

My lawyer and the meeting setup letter both said to turnover tax refunds I believe.