Taxes

[Doug7914]

What happens if I file for Bankruptcy as sole debtor and then usually file taxes jointly. Does anyone know if my refund at risk? I am in Florida.

[justbroke]

Welcome to BKForum.

It really depends on the circumstances. If you file without your spouse, then the question becomes whether or not any "anticipated" tax refund would be property of the bankruptcy estate. If you're trying to protect your spouse's portion of the tax refund, then you may need to try to exempt that portion as "not yours." This may also depend on whether or not you are the sole bread-winner. If you are the only source of income, the Trustee could easily show that you can only use your own "personal" exemptions to try to protect some portion (or all) of the refund.

Now that I think about it, it more depends on WHEN you file. If you file after you spent any anticipated refund -- on necessities, your attorney, your filing -- then it would be a moot point.

In the end, the question will be on when you filed, how much is attributable to your work, how much is otherwise exempt under federal rules (e.g. the earned income tax credit), and how much you can exempt using your exemptions. Just to name a few.

Since we are now entering the new tax year (after December 31st), it may be better to wait until you file and receive your refund, and then spend it for your attorney and other necessities. If you have enough exemptions (Florida's are stingy) to cover your anticipated refund and your property, then you could file at any time.

[Doug7914]

Thanks for the thorough explanation. Its helpful in my research when to file.