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Federal tax refund increase

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    Federal tax refund increase

    Have a question that I can't answer for a client since my bankruptcy knowledge is limited and is something I really don't handle. His wife filed alone a few years ago and is just starting her 3rd year of a 5 year plan. Apparently this years refund is going to be greater than the other years since his wife got a new job and now has more fed taken out than she did with her new job ( filing jtly) In the past he has asked me about his refunds and I told him since they were making about 20,000 less than her docs indicated she was making when she filed , I didn't see how they would take their refund and so far they didn't. But this year the refund is probably going to be around 4500 instead of 3000 due to college credits and the wife's deductions actually being taken out properly instead of way under before with old job. They also made about 2000 less than last year but the refund went up, don't know how but I can only assume the wife's new job is taking out the right fed deduction not like old job that barely took out anything.

    He comes to me to ask since he doesn't want to get on the trustees radar and would rather just buzz along unnoticed, and doesn't want to pay his former attorney insead, comes to me for free advice , which I don't really know.

    Any thoughts. Again, If she is about 20,000 under from what thery said she made at the time of the filing and 2000 less than last year, I feel he is safe.

    #2
    I am sure it depends heavily on the individual trustee....

    At the end of the day if the confirmation doesn't say that they that they have to surrender tax return $ than I do not believe that it is an issue.

    As I understand it the trustees in these cases are really only looking at tax returns for the income numbers to make sure that you haven't had a jump up in income compared to the plan docs (IE there is more disposable).

    I can tell you that I have been able to keep tax refunds significantly larger than the numbers you are talking with no problem (but I am in a different state with different trustees).

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      #3
      Yea, that's what I figured. Since I do mostly matrimonial, my bk is rather limited but you would be surprised how many clients have bk questions, that's why I read this forum

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