Tax refund came. Spend it?

[bleve]

Hello. I received a tax refund from 2008 last week. $5000 and some change. I Havent had the 341 yet. I Filed 2008 taxes right before the BK filing. I could really use the funds to catch up on necessities; Health insurance, Mortgage, Car maintenance (brakes and tires), Car payments and utilities.

If I spend it what is the worst that could happen? Would I owe the Trustee the same amount? Of course I will document everything. I knew it was coming I just didnt think it would come so soon. I dont think this amount fit into my exemptions.

Im in California

Help please

[SMinGA]

Talk to your atty first. If this is a refund for 2008, then you were entitled to it at time of filing. That makes it part of the BK estate.

Did you exempt it on your petition? Do you have available exemptions to cover cash/liquid assets?

The worst that can happen is the trustee requires that amount from you, in order to pay creditors.

[spetkovich]

Depending upon the particular circumstances of your case, the "worst case scenario" if the 08 refund is property of the estate could be a bit different than just having to repay the over-exempt portion of the refund to the Trustee.

For example, should the Trustee determine that you either knew, or reasonably should have known, that the 08 refund was property of the estate at the time you spent it, then your spending the refund could warrant sanctions for depletion of assets of the estate. Contact your attorney immediately prior to spending the refund. If you are a pro se debtor, contact the Trustee's office prior to spending the refund.

[justbroke]

Since you are in California, the first question is did you use System 2? If so, did you use the unused homestead exemption to exempt the "potential" refund? If not, do you have enough exemption left in the System 2 Unused Homestead Exemption to cover the refund? Did the Trustee ask for your refund? What does PACER say as far as being an Asset case or No-Asset case?

[bleve]

Thanks Pacer says no asset. Bear with me here it is listed in the petition as exempt under C.C.P 703.140(b)(5)

Does that help?

[justbroke]

Thanks Pacer says no asset. Bear with me here it is listed in the petition as exempt under C.C.P 703.140(b)(5)

Yes it does! That is California System 2! It is exempt. did you file through an attorney or by yourself? I don't see any issues.

[bleve]

I filed with an Attorney. I get a MUCH faster response on this forum than if I ask my attorney.

Thanks for your help! This forum is the best!

[justbroke]

I filed with an Attorney. I get a MUCH faster response on this forum than if I ask my attorney.

An attorney would never be in court if he were here all day. Anyhow, you should double-check with the attorney, but I see no issue as he clearly indicated it as exempt on Schedule C.

[bobbyquefour]

bleve, this forum is a GREAT resource. I am thankful every day that I found it....