Tax refund after filing CH13

[tn09]

I have not yet file for Ch13, but is leaning heavily towards talking to an BK attorney about my case. I do have a question though, it is about tax refund from IRS. Normally my wife and I receive a decent return from the IRS and State. Once I filed, how will the trustee handle tax refund? Can the trustee keep the returns and put it towards what I owe creditors? Or is this money off-limit from trustee?

Thanks,
TN)(

[jange]

It depends on the trustee. Some make you send in your tax returns and any refunds and some don't. When you talk to an attorney ask what happens in your specific district. My trustee doesn't want my tax returns or refunds.



19 payments done!

[Flamingo]

We had to provide both our state and federal tax returns to our trustee each year within five days of filing the returns. Check with your attorney as to what your trustee will require as to your tax returns and any refunds.

[tn09]

We had to provide both our state and federal tax returns to our trustee each year within five days of filing the returns. Check with your attorney as to what your trustee will require as to your tax returns and any refunds.

This is interesting to know. So all five years worth of your Fed/State returns were given to your trustee? Did this accelerated your payment plan? Or, was the refund already being used in your calculation when you reach a settlement amount with your creditors?

[forgotten]

This is interesting to know. So all five years worth of your Fed/State returns were given to your trustee? Did this accelerated your payment plan? Or, was the refund already being used in your calculation when you reach a settlement amount with your creditors?

If the trustee does take your refunds it will not pay off your plan any sooner unless you are in a 100% plan. My trustee has a "pay your payment and we don't have any any problems" attitude. No need to send tax returns, no need to report income changes, etc. They only want you to speak up if you get an inheritance, win the lottery, or otherwise come in to a windfall of money.

But every trustee is different. If you speak with an attorney in the area they would know how most cases are handled in your area.

[StaciMM]

Depending on your district & trustee, it could go either way. But if you normally get a large refund, unless its entirely child tax credit/EIC/etc. - you may need to look at adjusting your withholding now. One way to look at it: if you normally get a large refund, you really have more disposable income & can afford to pay more into a plan.