Is there a "Best Month" or "Worst Month" to file Ch. 7?

[PaKettle]

Is this anything like taxes, where if you file in April you'll have to wait longer? Not that I have a whole lot of choice, but if there is any lee way I might be able to choose between, say, filing in October of filing in September...

[SinkingFast]

Filing Spring and Fall, Trustees do tend to think of Income Taxes. Either the taxes you just filed or the taxes you will file come Spring.

We filed in Sept. 341 Meeting in October. Our Trustee asked to see our 2006 Income Taxes once we filed this Spring. We were Discharged right on schedule, but the Tax issue delayed our Closing.

[CindyLou]

I filed in the fall....my thinking was that there were more holidays and less chance of objections by creditors. Crazy thinking, maybe but it made me feel better.

[PaKettle]

I filed in the fall....my thinking was that there were more holidays and less chance of objections by creditors. Crazy thinking, maybe but it made me feel better.

That makes sense to me, too. Since Sept. or Oct. is 3+ months after my last charge and transfer, I think I'll probably have to file in the fall anyway. But it does make sense that the creditors would be too busy with other things and have less time to "do their job" to the fullest. The only thing is, I suspect it might cause our taxes to get garnished or count against us as income, in the new year, no?

[CindyLou]

the good news is that you have time to adjust your withholding so that you DON'T get a refund!!!!!Do an estimate on your taxes based on last year (if its similar circumstances) and then adjust your taxes accordingly. You could even file Married and 12 for the summer and then switch back to your normal withholding the month before you file and make up the difference. This is TOTALLY in your control.

[PaKettle]

the good news is that you have time to adjust your withholding so that you DON'T get a refund!!!!!Do an estimate on your taxes based on last year (if its similar circumstances) and then adjust your taxes accordingly. You could even file Married and 12 for the summer and then switch back to your normal withholding the month before you file and make up the difference. This is TOTALLY in your control.

But wouldn't that increase my INCOME, which is what I would want to avoid, the 6 months before filing?

If I file in September, will my income tax refund for 2007 even be an issue, since it would not come until May or June of 08 (assuming I don't file until April)?

[CindyLou]

I could be mistaken, so someone please chime in here. Your total income is figured using your gross income. That determines whether you are above or below the median. Its your disposable income which would be affected by changing your withholding. Talk to your attorney, but I'm thinking even changing it for 2 or 3 payperiods may do the trick. Depends on your trustee as to whether they take your income tax refund. This is yet another example of why we should all be sure we are loaning uncle sam our money each year!!

[lrprn]

I suspect it might cause our taxes to get garnished or count against us as income, in the new year, no?

Depending on your trustee, you may lose all or a % of your tax refund for this year to the trustee next year.

However, tax refunds *do not* count as income. You've already earned that money and it's included in your gross income when you file.

[SinkingFast]

We got asked to see our 2006 filed taxes because our previous 2 years that the Trustee saw Yo-Yo'd big time. A big refund one year and then we paid big time the next year. Which we explained. But the Trustee said he wanted to see a "normal year's filing" anyway.

A lady ahead of us at our 341 always gets a big refund. The Trustee asked to see her 2006 filed taxes as well.

If you have enough Exemptions, your attny can apply some of your Exemption toward any anticipated refund you might have.

Another way to do it is to adjust your withholdings as Cindy suggested. But instead of adjusting now, hold off until after you file. Some Trustees wanna see current paystubs up to the 341, others don't. Your attny can advise you what to expect. But as soon as you can, after you file, adjust your dependents upward as much as you can. That leaves you paying next to nothing in taxes for the remainder of the year.

Trustees have an average amount they will go after. Our Trustee wasn't interested unless our refunds totalled $1K or more. We changed withholdings after we filed and got our refunds down real low. The Trustee wasn't interested and abandoned our refunds.

[BKOnce]

All Federal Government agencies like to "relax" at the end of Fiscal Year (Aug-Sept)..

[rilbrianne]

I just posted a similar question... about tax refund. If debts are wiped out in ch. 7, there wouldn't be any debt to apply your tax refund towards (??) is that right?

I'm trying to figure out if I should wait until after I receive my tax refund next year... although I would really like to file now.

[BassBoy]

I answered your question in the other thread...........however............if you receive your tax refund and then file, you may have to provide receipts as to where you spent the money. But again, the larger refunds could make a Ch.7 an asset case, whereas your creditors receive some money. Maybe not enough to pay off the amount owed, but they'll get something. On the other hand, if you want to file now, then you may have to turn over a prorated amount to the trustee if he/she wants part of your refund as an asset.

[rilbrianne]

Thank you, I just went back and looked at my thread. This is so complicated.

[BassBoy]

Yes, it can be very overwhelming, but this is not that complex. When you file Ch.7, the Trustee's job is to look for money (assets), any money (any assets), to pay creditors.