Turning over tax refund after discharge?

[tobee43]

We plan on filing next week, and were told the trustee will want all of our refund next year. He also pointed out that they will make sure I took every deduction possible, therefore making "their" check the maximum. So for example: We pay daycare every week, so, there had better be a child care deduction on the 2010 return. Now, honestly, what do people do that arent able to get a SSN number from their provider.........it isnt easy to find good, reliable daycare that reports their at home income. Illegal, yes, but parents sometimes dont have the option.

I am not happy about losing the return, but at the same time, small price to pay if we get a no-hassel chapter 7

it really is based on when you file. when we filed in april we were receiving a large refund...we were advised to spend asap....however, during this time of year when you file...it goes to the trustee.

[dspii]

Basically, the TT is looking for low hanging fruit...your tax refund. Minus what you were able to exempt, he would only be entitled to 6/12 or about half. If your total refund is less than 1500 or so, he likely won't even take it...but that depends on the district. Now if your like me and got the mega-Obama bucks back last year due to educational credits...it was worth his/her effort to cash my check.

[tobee43]

Basically, the TT is looking for low hanging fruit...your tax refund. Minus what you were able to exempt, he would only be entitled to 6/12 or about half. If your total refund is less than 1500 or so, he likely won't even take it...but that depends on the district. Now if your like me and got the mega-Obama bucks back last year due to educational credits...it was worth his/her effort to cash my check.

what??? tell me...what exactly does an Obama buck look like??????

[tcreegan]

Hi Jovigirl22,

We plan on filing next week, and were told the trustee will want all of our refund next year. He also pointed out that they will make sure I took every deduction possible, therefore making "their" check the maximum.

"were told" "He also" attorney?

"they will" trustee?

Doesn't sound like your attorney has your back, they should have some ideas on how to minimize your refund w/o drawing a 'bad faith' card from the trustee. The trustee has no authority to dictate what goes on your tax forms, their option is to claim an attempt to defraud the BK estate. I can't imagine that is worth the effort unless we are talking about big bucks.

Hope you get a more favorable opinion on this...

Tom in Colo

[dspii]

what??? tell me...what exactly does an Obama buck look like??????

It's the 8 grand in refundable college tuition credit that the trustee got her share of...was not even expecting it, the refund was more than I paid in taxes all year. In fact I was trying to find a way to not claim the tuition (loans) so I didn't have to give her anything more than I had to.

[tobee43]

It's the 8 grand in refundable college tuition credit that the trustee got her share of...was not even expecting it, the refund was more than I paid in taxes all year. In fact I was trying to find a way to not claim the tuition (loans) so I didn't have to give her anything more than I had to.

ahhhhhh...now i understand why i didn't know what one looks like...and never will....can you take a picture of one and send it to me...LOL!!

[tobee43]

Hi Jovigirl22,

We plan on filing next week, and were told the trustee will want all of our refund next year. He also pointed out that they will make sure I took every deduction possible, therefore making "their" check the maximum.

"were told" "He also" attorney?

"they will" trustee?

Doesn't sound like your attorney has your back, they should have some ideas on how to minimize your refund w/o drawing a 'bad faith' card from the trustee. The trustee has no authority to dictate what goes on your tax forms, their option is to claim an attempt to defraud the BK estate. I can't imagine that is worth the effort unless we are talking about big bucks.

Hope you get a more favorable opinion on this...

Tom in Colo

tom, i could not agree with you more. i have never heard a client be told something like that. i'd be out the door...OR set his butt straight and tell him, he best have my back.

[tcreegan]

btw it pays to check, in Colo amounts in your refund from EIC and child care credit are exempt....but the only way I found that out was by reading the Colorado Revised Statutes on BK exemptions. It was not on any other BK website I visited.

Tom in Colo

[free2breathe]

Once again, I think I've been over-thinking things. What it boils down to is "Will there be anything about my case that will cause the trustee to determine it is an asset case rather than no-asset." Since the majority of Chapter 7 cases end up being no-asset, I probably have so much less to worry about than I've been fretting over. Honestly, if they wanted to take ALL of our assets (including exempt), the net total is less than $10,000 by far. Subtract our exempt assets, and then look at the assets (if you want to call them that) that are not exempt in this state, figure what the value of each is, and the trustee will probably be caught ROFL.

Still and all, I won't count my chickens before they hatch....but I will start thinking about those crispy chicken strips I might enjoy once they do hatch