Filing BK7 and the timing of large tax refund?

[postie]

I am contemplating filing for BK7 as soon as I find a good BK attorney

Before we divorced, I usually get 3 to 4k refund from the state and 4 to 5k from the Feds BUT now this will be my first time filing as single and my 2 kids are already over 18 (I have custody of them still due to colleges) I just found out that I could file as HEAD OF HOUSEHOLD which boosted my refund to about 10k from both state/feds.

Mind you I am struggling with paying rents, food, clothes, gas for car, auto loan, college student loan (parental loan for my kid) and 60+ total debt.

What is the good timing to file for BK7? I am due tax refund early next week (haven't filed it yet maybe tomorrow). Should I file with direct deposit? or paper check and go to check cashing store? I think trustee would ask where is the money? I need the money to pay for future rent, utilities, food and the most expense would be 4k to 5k for flying to northeast to check out my younger kid 5 different colleges so that expenses would cover air fares for 3 of us, hotels, car rentals, food, etc.. for a whole week. Will trustee object to that? I am not trying to hide the money because approximately 55 to 60% of NET paycheck goes to rent ALONE! ) I can't move till end of summer! My girlfriend & friends was nice enough to pay for food and any small expenses till I recover. (Divorce, plus job suspension placing me emergency non-pay status for 3 weeks recently) which will whack my monthly budget since I have to make up with retirement, retirement loan, health, dental and vision insurances, union dues etc etc etc) which cost alot of money from missed pay! (I work for fed government).

Your thoughts? advices (I know it's not like attorney advices) Just getting gist of what to expect... (Oh BTW, I changed earlier 2014 to single and 0 deductions on my W-4 which grabbed alot of my gross paychecks)

Thank you

[postie]

Whoops! I meant $60,000+ debts

[bcohen]

My thoughts are that if you need to use the tax refund for ongoing expenses, then you best not file until after the money has been received and spent. Are you presently being sued, or having your wages garnished for a dischargeable debt? If not, then I fail to see why you are in such a hurry to file. In fact, if your situation is as dire as you suggest, it may not be in your interest to file for bankruptcy in the forseeable future.

[BKAttyMI]

I agree with bcohen, I would also be very concerned that with your financial situation, you would even consider spending money flying to the east coast, paying for hotels, food, etc. for college visits??? Note that college expenses are not considered necessary expenses on a bankruptcy petition. You need to discuss this situation with a local bankruptcy attorney.

[LadyInTheRed]

There is no need to keep the refund out of the bank unless you have a creditor with a judgment against you. Just keep the money out of any institution to whom you owe money if you are in default or will default soon.

California has a generous wild card exemption, especially if you don't need the homestead exemption. So, unless you have other significant assets, you can probably exempt the tax refund rather than rush to spend it before you file. Are you sure you qualify for a Chap 7? The tax refund may be considered income on the Chap 7 means test. If you have to file a Chap 13, having that cash in the bank will be very helpful in getting you through a Chapter 13. Don't spend it until you consult with a couple of attorneys and have a plan in place.

If you will be able to claim head of household again in 2015, you really should adjust your withholding. That's $800 a month you could be using for living expenses. Just make sure you don't go to far and end up owing next year.

Unless your kid has huge scholarships available, he/she may have to consider going to college closer to home for at least a couple of years while you get your financial situation under control. Community colleges are a great way to get the GE in before transferring to a university. Not everyone can give their children everything they'd like to.

You definitely need to sit down with a couple of BK attorneys to go over your situation.