Trustee did not state anything about taking 2012 tax return.

[chad1113]

Hi,

I am new here and I had a question that my wife and I were very concerned about, we went to our 341 meeting on Nov. 20, 2012. We didn't know this..but there was a substitute trustee at the meeting. During our hearing she stated everything and asked us all the required questions except for obtaining our 2012 tax return, so we mentioned that to our attorney. He told us to wait about 14 days to see if we get anything in the mail from the trustee stating that the would need our copy of the 2012 tax return once we file it. To this day we still have not heard of anything about the tax refund. I have two questions regarding this. 1. Since it was not stated on recording in the meeting nor did we receive anything in the mail, can they still take the refund? and 2. Is there anything we should do at this point?

Thank You.
Chad

[tobee43]

welcome to the forum chad113.

i would wait to make certain the "waiting" period of the 60 days is over and they i would think you are in the clear.

usually when one files their bk at the time of year you did, the tax return monies are of interest to the trustee. doesn't say it does happen all the time. we filed at a different time period of the year and it was never mentioned by anyone. of course we filed our taxes prior to april 15th of the year we filed.

[justbroke]

Yes, they can still take your refund "if" it is not exempt. A not-exempt tax refund (or portion of a tax refund), is that part which could not be protected by the bankruptcy exemptions. First, did your attorney attempt to exempt your tax refund? If the attorney did exempt it, I would not think the attorney would tell you to "wait" and see.

I would go back to my attorney and direct them to contact the Trustee's office for clarification. There are debtors that have made the mistake of assuming that the tax refund was exempt because they don't remember hearing anything about it. They later learned that they owed the Trustee the money and had their case almost dismissed for not turning it over.

[Drazil65]

Hi and welcomed. We filed 12/13/11 and 341 was in january, our tax refund was never mentioned. We were discharged and closed the same day and refund never mentioned. We filed our taxes and received our refund all in March. Wait until after your discharge/close and then file tax refund if it makes you nervous. Good Luck!

[justbroke]

Just as an FYI, it does not matter when you file your tax return. Whether any tax refund is "property of the bankruptcy estate" is controlled by the date you filed your bankruptcy petition; not the date you filed your tax return.

[tobee43]

Just as an FYI, it does not matter when you file your tax return. Whether any tax refund is "property of the bankruptcy estate" is controlled by the date you filed your bankruptcy petition; not the date you filed your tax return.

there is a thread Hhm did which i recall...i think it was oct is about the time that the trustees begin to take a look at your potential refund?

[justbroke]

there is a thread Hhm did which i recall...i think it was oct is about the time that the trustees begin to take a look at your potential refund?

Yes there is a thread from HHM on this topic. Trustees are always interested in a potential tax refund. The Trustee are just much more aggressive on potential tax refunds in the Fall through Winter period because it is "low hanging fruit" and amongst the easiest asset to collect since it's already liquidated.

[tobee43]

Yes there is a thread from HHM on this topic. Trustees are always interested in a potential tax refund. The Trustee are just much more aggressive on potential tax refunds in the Fall through Winter period because it is "low hanging fruit" and amongst the easiest asset to collect since it's already liquidated.

makes perfect sense. i like your low fruit anthology!

[chad1113]

Thanks all for the responses regarding this everyone! this is helping, I'm just hoping they don't take it because it would be nice to help us throughout the year. I am trying to be ok if they do take it though.

[LadyInTheRed]

Thanks all for the responses regarding this everyone! this is helping, I'm just hoping they don't take it because it would be nice to help us throughout the year. I am trying to be ok if they do take it though.

Check Schedule C of your petition. Is the refund listed? If not, don't spend the refund until your case is declared a no-asset case and is closed.

[tobee43]

i agree with lady ....found the thread that HHM did on this exact subject... it's worth a peek: http://www.bkforum.com/showthread.ph...230#post456230

[jodie3134]

We filed September 6 and our 341 meeting was October 23. Nothing was mentioned in our 341 meeting about the tax returns and we received a refund of about $7000 last year. I fully expected our trustee to say something about this coming return and nothing was said. We received our discharge/close the other day and our upcoming refund is ours to keep.

[justbroke]

In many States, the exemptions are plentiful enough that most people can exempt an anticipated income tax refund without worry. A Trustee would not ask for your refund if you had adequate exemptions to protect it, and you did in fact exempt the potential refund on Schedule C.