Taking 75% of Tax Refund!

[mom2boys]

My husband and I had our 341 meeting yesterday. Everything seemed to go well, except at the end we were told that they would be intercepting our State and Federal tax refunds and taking 75% of them!

Ugh, we were very frustrated when we heard this! Our attorney explained to us that they can only take 75% of what is withheld, but that still seems like a lot. Has anyone here dealt with this before? Did you still get a good portion of your refund? It frustrated us even more because we started this process almost a year ago, and it took our attorney almost 2 1/2 months to set up our 341 meeting. Had she done this a lot sooner, we probably wouldn't even be deal with this...

I recently became a stay-at-home to our two young boys (3 & 1), and my husband is the only one working. He is tempted to re-do is W2 and claim 6 so that less is taken out of his paycheck for taxes. Would this help us at all? Would this get us in trouble? Should we just leave it alone?

I appreciate any help or info you can offer us!

[free2breathe]

Changing your withholding at this point in the year won't do much to help. Unfortunately, the tax refund "earned" up to the date of filing is subject to being turned over to the trustee. We ran into the same thing. If you are lucky, in your district, they will only touch withholding amounts. In our district, they will also take their portion of earned income credit. I'm not sure about the child tax credit, because there is nothing I can find regarding that. I have resigned myself to the fact that it's a small sacrifice to surrender 3/4 of our refund, our balance in our checking on the day of filing, and 25% of my husband's earned-but-not-paid wages at the time of filing in order to receive the debt relief that we will receive when all is said and done.

Doesn't it just feel like they want to kick you when you're down though?

Congrats on getting through the 341 though! Welcome to the 60 day club

[tcreegan]

Hi mom2boys,

In Colorado the EIC and the $600 additional child care credit are exempt, so at least that is some they can't get their hands on.....

Tom in Colo

[free2breathe]

Hi mom2boys,

In Colorado the EIC and the $600 additional child care credit are exempt, so at least that is some they can't get their hands on.....

Tom in Colo

I so feel like I live in the bankruptcy twilight zone! Our exemptions stink ;)

[enginegirl]

at least you get to keep 25% of your refund... here in FL if you are not paying back 100% they take every single last penny... oh and then they figure it in for your payments for the next 60 months... count your self lucky that you get to keep a fraction of it!

[free2breathe]

at least you get to keep 25% of your refund... here in FL if you are not paying back 100% they take every single last penny... oh and then they figure it in for your payments for the next 60 months... count your self lucky that you get to keep a fraction of it!

Yes, if we'd filed 13, we'd give it up for the duration, I'm sure. I'm glad we qualify for 7

[enginegirl]

Yes, if we'd filed 13, we'd give it up for the duration, I'm sure. I'm glad we qualify for 7

I so wish I had qualified suxs

good luck to you! it will ll be over soon!

[tcreegan]

Hi enginegrl,

at least you get to keep 25% of your refund This is just b/c they filed 9 months into the year (75%), Post filing they get to keep the rest of the year (25%).

Tom in Colo

[dumpinmydebt]

I'm prepared to give up my tax refund if they want it. Don't really think they will since it's not going to be large (only pay like $35 bi weekly in Federal taxes). But if that's what it takes to get rid of this debt and have a fresh start then they can take it all.