Will I lose my tax return?

[icyhot]

Talked to my lawyer and I am due to file around the week of 2/12. I filed my taxes and am due a refund of 7.3K. I am filing a chapter 7 and my income for last year was well under the median. Will they take my refund even tho it’s such a negligible amount compared to what I owe? I read a few places to spend it on necessities like bills, so that may be what I do. However I did want it to sit and save interest for emergencies.

[bentleyboii]

I would have a discussion with your lawyer, these types of qestions are best suited for them (Even though this is a great community) Im sure your paying him plenty for these anwsers  

[Anonymous]

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wrote:
Talked to my lawyer and I am due to file around the week of 2/12. I filed my taxes and am due a refund of 7.3K. I am filing a chapter 7 and my income for last year was well under the median. Will they take my refund even tho it’s such a negligible amount compared to what I owe? I read a few places to spend it on necessities like bills, so that may be what I do. However I did want it to sit and save interest for emergencies.

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I doubt it. I filed in November 2017 and had my 341 in December 2017. I filed my income tax return and also am due a refund similar to yours. Today the trustee filed a report of no distribution. So my tax return was not asked for. But i did list it as an asset on the bankruptcy schedules.

[Anonymous]

We did. We had 5.6k refund when we filed we had to write a check for 3000.00 of it to the chapter 7 trustee.

We filed 7/2012 discharged 12/2012 took the refund (most of it) 2/15/2013

[despritfreya]

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wrote: I doubt it. I filed in November 2017 and had my 341 in December 2017. I filed my income tax return and also am due a refund similar to yours. Today the trustee filed a report of no distribution. So my tax return was not asked for. But i did list it as an asset on the bankruptcy schedules.

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Did you claim an exemption? If not, once your Trustee finds out, he/she may very well withdraw the report of no distribution.  Unless there is an exemption, he/she is entitled to 11/12s of the refund.  It will be up to him/her to decide if withdrawing the report is worth it.

OP, 

Your Trustee is most likely going to take the 2017 refund because it is "large" (anything over $1000 is typically considered "large").  He/she has the right to take it unless you can claim an allowed exemption.  You need to discuss this with your attorney.

Edt to add:  Of course, if you receive, cash and properly spend (keeping receipts) the refund before you file, there will be nothing for the Trustee to take.  Talk to your attorney.

Des.

[Anonymous]

I just checked my petition and yes we did claim it as an exemption. I guess thats why.