Tax Refund Exemption in Georgia

[TDS1120]

I reside in Georgia and can't seem to find a clear, definite answer to my concern. I received a $5600 tax refund of which $4015 was EITC and CTC. I've already began to spend it down to the tune of $2300 on past due bills, student loan, and necessaties.

I need to know if the EITC and CTC portion of my return is exempt because I would like to file ASAP to stay a pending judgement.


Thank you in advance.

[nichole04]

I live in Georgia as well and my attorney told me that I could exempt a good portion of my tax refund with my wildcard exemption and my homestead exemption since I am underwater with my house and have no equity to protect. I would ask your attorney about this before filing.

[SMinGA]

I'm in a similar quandary - except I filed a 13 in Dec and received the refund last week. My attorney thinks its additional income and the trustee can take it. I think it should be an asset which I can exempt. But since you have the refund and have not yet filed - I think yours is a simpler situation.

TDS, confirm with your attorney but as I understand it - keep records of what you spent the money on and you should not have a problem.

For money you have on hand when you file, there is a $600 wild card and you can use up to $5000 of any unused homestead exemption as additional wildcard.

[nichole04]

my attorney said we could exempt $10,000 in georgia b/c our home is underwater and since my husband and I are both filing bk we can exempt $5,000 each. I hope he is right. We have already gotten our refund back and are filing in april. I don't want to give it up to the trustee if I don't have too.

[SMinGA]

Nichole, that matches what I understand... The homestead exemption is $10k each and you can use up to $5k each of any 'unused homestead' as additional wildcard.

I think my issue may boil down to semantics - if I filed after getting the refund there would be little or no question since cash on hand is clearly an asset. I filed in December, could not wait til after filing/receiving refund to file my ch. 13...

[nichole04]

So if I can exempt the refund with my exemptions does that mean that I won't be an asset case?

[SMinGA]

Asset cases - as I understand it - are when there are non-exempt assets. If everything is covered by exemptions (regular or wildcard) then yours should be a no-asset case.

[nichole04]

Thanks for the info. SMinGA!

[wesw0000]

can i use it to buy a car since i am loosing mine in my chapter 7?

[SMinGA]

Wes, using a tax refund on necessary items should be fine. Transportation is a necessary item.