Tax Refund Concern

[Surrender]

I get a healthy tax refund. Somewhere in the area of 4-5 thousand.

I use this refund for all my larger expenses. Last year alone I used it for car repairs, clothing, and oil (heat).

I anticipate using it for much of the same this year. I factor in my refund to my budget.

Can the BK still take it from me if my monthly income is far less than my monthly expenses?

Without CCs I'm able to function IF I can spend my refund.

Thanks

[bkfiler]

im not all the super sure. but from what i see after 2 days of watching 341's adn reading i beleive that IF the trustee does take tax refunds then they will take take your tax refunds regardless of what you use it for. im worried for you. ask your lawer what will happen.

ill wait to see what people post as their actual experiences are for fact.

good luck!

[sunshine08]

Our refund was for more than that. We filed in May. Got to keep it. We got the money in April. Did about the same thing, pay oil bills, property taxes, homeowners, that type of thing.
I think our attorney figured in our refund into our budget. Hope that helps.

[accentone]

hate to be the bearer of bad news, but that was the first thing our trustee went after. we filed in September. We should get a discharge, but we had to sign a stipulation that our case would not be closed until we turned over returns and refunds. Bummer. We usually get a good refund, too. But I figure for all the money that are excusing me for, it is a small price to pay.

[2US]

hate to be the bearer of bad news, but that was the first thing our trustee went after. we filed in September. We should get a discharge, but we had to sign a stipulation that our case would not be closed until we turned over returns and refunds. Bummer. We usually get a good refund, too. But I figure for all the money that are excusing me for, it is a small price to pay.

So if I expect to be discharged on 11/14, and no one (trustee or lawyer) has brought up anything about the refund (no signing of stipulations or such) am I to assume that I am in the clear for it, or by filing my return, will this alert the trustee and reopen the case?

[sunshine08]

You got it.

[pink_amulet]

We also get back a good amount. Ours is planned for my surgery, and related expenses. I was worried about ours....From what Ive been seeing it is up to the individual trustee. I am in NW Illinois and our trustee didn't even ask. I ask our lawyer before our 341 and she said this trustee hasn't even asked about it. HOWEVER I think someone else on here from Illinois said they have to turn over their return to their trustee. They also went to a different court than we did, but it was the same state...so you can't go by states. I guess you have to go by Trustees.
The only positive thing is the trustee can't take your earned income, and your child tax, also they only take a % of the return. Example say you filed in Sept (9th month)..the trustee could take 9-12ths of a refund.

Hope everything goes well for you, and the trustee is a nice one!!


pink_amulet

[quest42]

Remember... It's the trustee's job to take everything from you that is not exempt! And, you can have your whole BK thrown out if you do not play by the rules...

There's a handy form in the back of the NOLO book How to File for Chapter 7 Bankruptcy... www.nolo.com www.amazon.com or your local library...

SUPPLEMENTAL SCHEDULE FOR
PROPERTY ACQUIRED AFTER
BANKRUPTCY DISCHARGE

etc...

under penalty of perjury ...


Do you have any exemptions left? Wish I could give you some of my spare ones...

[thompsoj]

I am still confused on the child tax credit part of the refund. If it weren't for that I would get no refund because it wipes out the taxes I owe. Is it safe to assume that my refund will be protected?

[quest42]

I've been told that it is NEVER safe to ASSUME anything!

Seriously, you better ask an attorney... it seems that anything you acquire within 180 days of filing BK (or before your discharge, whichever is later) is fair game for the trustee to take -- simply put, that's their business! That's their job... that's how they make a living!

Just common sense, right? Our federal/state/district exemptions list is our only refuge from our creditors and the BK trustee, as BK filers, yes?

[Lightning]

It would be smarter to increase your exemptions so you get the "refund" money throughout the year. Then invest it in an ING savings account, for example, or a Roth IRA. You'll earn interest and have access to the money if you need it for an emergency.

[Surrender]

I did claim this money as a contingent tax return. I am coming clean about it. My numbers are so far upside down, that I cannot possibly maintain without it. To be truthful, I'd be surprised if they took it. I am playing by the rules, everything is upfront and in black and white. I'm not trying to "get over" on anything. I'll just have to hope for the best and trust the process.

[thompsoj]

After reading my paperwork again I realized mine was listed under the Schedule C exemptions (11 USC 522 (d) (5)) along with accrued wages, so I believe all is well.

[bezoar]

There's really no way to tell for sure. It does seem to be up to the individual trustee. My GF's never mentioned it (he saw her last 2yrs returns listing $3K each year). My trustee made strong statements at the beginning of that block of mtgs that she would be taking those.

Your best bet might be to attend some of your trustee's mtgs or ask your atty if your trustee normally takes refunds. Remember that the trustee doesn't care a bit about whether or not you need the refund for survival. It is just business - he/she is supposed to liquidate assets available to him and distribute to creditors (the trustee represents your creditors). It may seem harsh, but that's his job.