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How can you find out how much of your income tax the trustee will take after filing chapter 7 bankruptcy?
The answer to this question varies from jurisdiction to jurisdiction, but I would say it is wise to ask your attorney what the common practice is in the district in which you filed. In Indiana, the trustees normally lets debtors know at the Meeting of Creditors (also called the 341 hearing) whether they want the refund check, and if so, how much. Different states let you keep different amounts of cash in bankruptcy, so the state in which you live may influence how much the trustee takes. Please note that nothing in this posting or in any other posting constitutes legal advice; this is simply my understanding of the facts, which I do not warrant, and I am not suggesting any course of action or inaction to any person.
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If you and your spouse have filed Chapter 7 then she CASHES her tax refund what will the trustee do when he finds out?
The trustee has several options, but the one you need to be concerned with is REVOKE YOUR DISCHARGE then have you charged with bankruptcy fraud by the F.B.I which rarely resul…ts it jail time, but could carry a fine up to $10,000 with a possible felony record. If you can't afford to pay the bills you can't afford to lie to the courts either. Good luck.
Yes. For 3 years. They do not take it all. You will get to keep your EIC and certain other credits that may be given that year. This is per my bankruptcy lawyer.
In the state of Ohio is a chapter 7 bankruptcy trustee entitled only to the portion of a tax refund from the date of the bankruptcy filing.?
Answer . Depending upon the amount of time between the filing of the BK and the filing of the tax return; a refund may be pro-rated to determine the portion that is include…d as a BK asset.. And if anything, the portion to be taken by the trustee is the part relative to before the filing. Follow: Pre petiton assets and liabilities are in the BK. Taxes withheld from earnings are basically money put on deposit with the government, to pay the tax due/payable later on. Just like any other "savings" account. Had you had the 'correct" amount withheld (instead of too much, causing a refund), the additional you received would have been available for to pay those creditor/debts. Earnings (and hence tax overpayments) from after the filing are not part of the BK.
Answer . \nA tax refund is considered income/asset belonging to the BK petitioner and is therefore subject to seizure for the repayment of debt.\n. \nWhether or not the r…efund can be included in the BK depends upon the time frame of the BK filing vs. the tax refund date and amount, the status of the refund (joint, subject to child support action, etc.) and so forth.
Why can a trustee take your income tax return if you are filing a chapter 7 bankruptcy which relieves you of your debt and does the trustee give the money to the creditors?
Answer . \nThe trustee may take the refund and distribute it to creditors because a tax refund is not considered an exempted asset under bankruptcy laws.
Answer . This Q has been pushed around a lot here...and this is what I've pieced together:. It depends...a bit on which circuit court your in and how they feel...and expecia…lly how much is involved...(obviously large amounts are wanted for creditors...and it just seems unfair for you to not pay someone your debt, because you didn't have the money, because you had too much withheld or prepaid...when the amount withheld/prepaid is controllable and returned to you!). The other aspect is when you filed compared to when you made your money...If the overpaid tax is for a pre-petition filing period...most trustees want it...but if it really isn't then it's yours. So say it's a refund for the year and you filed BK in December.....well it was basically all withheld as part of the Jan-Dec period in your filing...and it part of the BK...but if you filed in say March...well not much of it is really from the covered BK period.. Sort of makes sense.
This question has been discussed many times here..and there seems to be no hard and fast rule. Certainly, it depends on several things. Most importantly, is what period the… overpayment reflected in the refund really relates to. For example, say it is a refund for a year and you filed BK in Dec of that year. Basically, all of the tax you paid in was from pre-petition...had you had the correct amount withheld (or by estimated payment, hence no refund of overpayment being made), presumably (and rightfully) that additional amount would have been available to pay those creditors. Consider, you could have had more (even 100%) withheld and deposited in your account with the Government, that shouldn't mean you get to essentially just withdraw it now. (Had you put it in a bank account you wouldn't expect to). On the other hand, if you file the BK in January, then virtually all the overpayment is due to earnings post petition...which are actually yours and not part of the bankruptcy. Viewed this way, I think the actions make some sense. Add in any complications, like you don't make earnings evenly through the period...and it's a question needing a reasonable solution you may need to propose to the trustee.
Depending on some things, like when the tax was paid and when the BK was filed, the refund is like any other asset and available to creditors. The trustee or court would take …it and pay it to creditors according to their standing in the case.
How much will a trustee take out of your monthly income in a chapter 13 bankruptcy Is it a certain percentage?
It's your disposable income. The debtor files a statement of income and expenditures. The expenditures cannot be unreasonably high. The chapter 13 payment is the difference be…tween the income and expenditures.
Yes, but it may be very difficult for you to determine your own eligibility for a Chapter 7 filing. Attorneys have automated software programs to assist them with this questio…n.. Part of the bankruptcy filing paperwork is a form commonly known as the "Chapter 7 Means Test". It is actually about 4 different "tests" grafted together into one form, in a format where you only take the subsequent tests if you "flunk" the previous one.. If you "flunk" all of them, you have to check a box on the first page that informs the Court and the Trustee that your Chapter 7 filing is "presumptively abusive" of the bankruptcy code, and the Trustee then has an affirmative duty to seek the dismissal of your case, or its conversion to a Chapter 13 case. This is not to say you are home free once you "pass" the Means Test. Your case can still be dismissed if it is later determined to be abusive of the code despite passing the Means Test.. The first test is fairly simple. You just list your gross income. If you are filing jointly with your spouse, you must list both gross incomes. If your gross income is less than the state average for a household of your size, you pass, and you don't have to fill out the rest of the form. I am only familiar with the average annual income levels for Michigan, and, off the top of my head, its about $43,000 for a household of one, and about $51,000 for a household of two, with similar incremental increases for larger households.. If you flunk the gross income test, you move on to the next one, which allows you to deduct from gross income your payroll taxes and average living expenses for your region of the country. This might be a little tough to do, although the data exists out there somewhere, maybe on the IRS web site. If you can claim enough deductions in this second test, you might just qualify.. The third test allows you do deduct your mortgage payments and car payments, so if you have larger than average car payments and house payments, you might just pass that one.. Finally, they have a fourth test which basically tries to figure out if forcing you into a Chapter 13 bankruptcy would yield enough money for your general unsecured creditors to make the time and trouble of a Chapter 13 case worthwhile.. You can certainly find a copy of the Means Test form online and plug in some numbers to get an inkling about whether you qualify.. So, there is no simple answer to your question. There is no bright-line cut-off point. In my practice it is not unusual for a suburban family of four with two late-model cars and a big house to qualify with a household income of $100,000.
Just filed? Just like always, except one would expect that it would be something the administrator will want, along with confirming the status of the account with the IRS. The… business last filing should be after it dissolves.
If you are partners in an investment property with someone who is filing Chapter 7 Bankruptcy should you be worried that the trustee will take the asset and will the partner's credit be affected?
Basically, all the things....his credit will be affected badly...although as a general rule, by the time one declares BK it normally is already.. What happens with his intere…st in he property depends on many things, and most certainly how the 2 of you hold title. Presuming it is as tennants in common, his interest will be part of the BK and the court would probably ask you to buy him out, so the money can be used to pay his debts...if that can't be arranged, they can sell it to anyone, again to pay his debts, and you basically become partners with whoever that is. Of course, if you own it together through some legal partnership, there can be some twists...but the bottom line is....he doesn't get to not pay his debts and keep things of value those creditors would be happy to have instead of nothing.
Sure.. Can you take the money and not pay it back as you promised from a business whose owner and employees have kids?
It depends on whether your attorney has protected your income tax return refund or not. Again, it all depends on whether it was calculated as future income or protected. Check… with your attorney. Clarifying - if the refund comes from an overpayment of taxes on income made pre-petition - then the refund is part of creditor assets and goes to pay them. Just like had you deposited it in a personal savings account at the local bank, to pay tax next year, instead of with the government bank account.
Can bankruptcy trustee take proceeds of lawsuit settlement 8 years after filing chapter 7 if both lawsuit and bankruptcy were filed around the same time?
The Lawsuit was required to be listed as an asset. If it was listed, and then abandoned by the Trustee, then it is yours to pursue. If it was not listed, then it belongs to t…he BK estate managed by the Trustee, until the BK case is reopened and the Trustee determines whether or not it is an asset and how to manage it.. regardless of how many years have passed (because the lawsuit does not belong to you anymore, unless the Trustee makes that written statement that it has been abandoned). Once a bankruptcy petition is filed and a trustee appointed, " 'the right to pursue causes of action formerly belonging to the debtor , vests in the trustee for the benefit of the estate.' " (Bauer v. Commerce Union Bank, 859 F.2d 438, 441 (6th Cir. 1988)(quoting Jefferson v. Mississippi Gulf Coast YMCA, 73 B.R. 179, 181-182 (S.D.Miss.1986)). ) Accordingly, a bankruptcy petitioner loses standing for causes of action and the estate becomes the real party in interest unless the bankruptcy trustee abandons the claims. (See In re Lopez, 283 B.R. 22, 28-29 (9th Cir. 2002); In re Pace, 146 B.R. 562, 565-66 (9th Cir. 1992).) Because the trustee controls the estate, the trustee is the real party in interest with standing to sue under any cause of action that belonged to the debtor when the petition was filed. It follows that "the decision whether to pursue a claim or not is vested within the trustee's discretion." (Detrick v. Panalpina, Inc., 108 F.3d 529, 535 (4th Cir. 1997).)
If the property was claimed as exempt the trustee has 60 days to either exempt or reject the contract. If nothing is done then the contract is automatically rejected and the t…enant is considered a holdover tenant. If you exempted the property the property reinvests in the debtors name and thus the rents should follow as the debtor is the only one with standing to collect the rents. That is not to say the trustee will not try hard to stand in your way though.
If you still owe federal income taxes, they will. But if they don't take it, the chapter 13 trustee gets the tax refund. You should have listed any income taxes that were dis…chargeable (due more that 3 years prior to the filing date).