What would you like to do?
This may not be helpful at all, but for what its worth... I have no idea what the exemptions are like in New York, but in Indiana, trustee's couldn't care less what the debtor intended to do with the refund check. Indiana law says you get to keep $100.00 of cash per debtor, period. Anything above that the trustee will keep and distribute to creditors. It is not an issue of what the debtor had planned for the money, or how bad the debtor needed the money, it is simply math: the law says you keep $100.00 and the trustee gets the rest, and that's the end of the analysis. Assuming New York is like Indiana, I would say the trustee will be unmoved by what your plans are for the refund. But, like I said, I don't practice law in New York so maybe there's some exemption over there that is different that what happens in Indiana.
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 have filed Chapter 7 this year and your spouse has failed to turn over her tax refund can either of you be brought up on criminal charges?
Normally no. What is most likely to happen is that your bankruptcy will be dismissed for failure to comply with the Trustee's request for the documents. I agree… with Nate; failure to produce the tax refund normally results in dismissal rather than in criminal proceedings. However, if one spouse complied with the trustee's wishes and one spouse did not, the spouse who complied can move to have the case de-consolidated, so that the spouse in compliance still successfully receives discharge and only the non-compliant spouse gets dismissed. The court charges a fee to de-consolidate a case, and the attorney representing the debtors normally charges additional fees for the extra work as well. 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.
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 resu…lts 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.
Filing Return While in Bankruptcy Yes, you still have to file your taxes as usual. Any refund will probably be appropriated by the trustee and treated as a nonexempt as…set, which will be used for repayment of creditors. Adding As indicated, this is one of your assets and must be disclosed to the creditors committee as something they can use to pay your debts. They will probably ask about it if you don't provide it. They've seen it many times before.
Answer The answer depends on who the creditor is and the status of the debt. If the debt was a student loan or other non-dischargable debt, then your tax refund …can be taken. If the debt WAS discharged, ANY collection action of any kind on a discharged debt is a violation of the permanent injunction of the discharge and therefore illegal. If the creditor was not included on the creditor matrix, then informing them of the bankruptcy and discharge of the debt may be all that is necessary to have the refund returned to you. In other cases it may be necessary to file a Motion for Contempt against the creditor in bankruptcy court. This would require the re-opening of the bankruptcy.
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 inclu…ded 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 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 expecially 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.
If you have a court ordered tax refund garnishment from Michigan and you now reside in New York For 4 years can they take the refund Also can the garnish the wages of the spouse if they file jointly?
Yes. they can, but you should file jointly and so they don't garnish the spouses part, file injured spouse, and I do not know why it is called that but I know my husband owe…s back support and that is how we have to file so I will get my part. Ans The one above, who erased my previous answer but goes on to say she doesn't really know what she is signing....well hope she qualifies or it could be criminal... And no matter what, to avoid the issue, filing seperately is better. And no matter what...getting your spouse to pay their obligations, (like there taxes or supporting their kids) is better. And if your in a community property state, or the debt doesn't come from those very specific things, etc., etc., injured spouse won't work. Accepting it, and when the problem comes up...you'll have serious ones (probably after he abandons you like he apparently may have done to his last), or just fails to pay his taxes now too...maybe lies on them (the current ones YOU ARE responsible for). You are an injured spouse if your share of the overpayment shown on your joint return was, or is expected to be, applied against your spouse's past-due federal debts, state taxes, or child or spousal support payments. If you are an injured spouse, you may be entitled to receive a refund of your share of the overpayment. For more information, get Form 8379, Injured Spouse Claim and Allocation.
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 perio…d the overpayment reflected in the refund really realtes 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 should 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.
If you filed chapter 7 in 2005 and your house was foreclosed on in 2007 do you have to pay taxes on it?
If the foreclosure was not part of the bankruptcy, yes.
Either way they will want a tax return filed before filing for chapter 13. If you are expecting a refund then they will seize it if it is after so to keep the money fi…le first and wait for the return, it will be considered as part of your income. If you owe it is better to know the amount before filing.
Very likely...the refund is because you had more money than needed withheld from your paycheck and pu in (essentially) a savings account at the IRS to pay your eventual …liability. This money, earned and saved pre-filing, had you not had it put aside (or had you correctly estimated and completed the W-4 so the right amount was withheld), would have been available to pay the creditors. You know, you could literally have had 100% of your pay withheld....think it makes sense youc could get and keep it after filing BK? Of course, as BK is Federal Law, and in a FEDERAL court, the State makes no difference. And of course, the Court has some discretion in these things too.
Yes. And the court will likely want to see your return.
If received for last year yes. the one for next year, received after filing, no.
Yes. Do you think the IRS should just presume that everybody who doesn't file doesn't owe any taxes? 26USC6012 requires anyone having more than a certain amount of income …to file a tax return. 26USC7203 makes willful failure to file a return a crime punishable by up to a year in jail and/or a $25,000 fine. Neither of these laws carry any requirement that you owe money. It is extremely rare, but people have been successfully criminally prosecuted for failure to file even though they might owe no money. See Spies v. United States, 317 U.S. 492, 496 (1943); United States v. Wade, 585 F.2d 573, 574 (5th Cir. 1978). Is the typical guy whose only source of income is a W-2 on which he had way too much tax withheld going to get prosecuted? No. Maybe if he gets arrested for something else like drugs, a tax charge might be piled onto his case. Or if he sends threatening letters to the IRS commissioner, they might take revenge. But not typically. People who have never had any income other than a W-2 forget one fact: The IRS does not know whether you owe any money until you file your taxes. A lot of people have income from other sources that does not get reported on a W-2. They owe income tax on that, too. And the IRS does not know that you have dependents or have deductions or whatever unless you file a tax return. They need that statement, sworn under penalty of perjury, of your income, deductions, exemptions, credits, and so on to properly calculate whether you owe taxes. If you don't send it to them, they will make certain worst-case assumptions about you and could even pursue you for taxes you don't owe. And if you don't file, the statute of limitations never starts running. That mean that the IRS can hound you over whether you owed taxes forever. There are also certain elections that need to be made on or before the filing date. Failure to make these elections in a timely manner means you forfeit the opportunity. For example, you can take a return of your current year IRA contribution or recharacterize a contribution up until October 15 of the next year, but only if you file your return (or an extension) on time, even if you don't owe money. Now many people will point to the fact that the civil penalty (as opposed to the rare criminal penalty) for filing late is based on the amount of money you owe. If you don't owe any money, the penalty is $0. (Note: some states impose penalties that may not be based on the amount you owe.) They then extrapolate that to mean you are not required to file and nothing will happen if you don't. These people do not know the big picture. And I don't know how many times I've seen people say "I always get a refund" but this year they don't. And they don't realize it because they haven't filled out their taxes. Or they make a mistake on their taxes and the IRS catches them. They end up paying thousands of dollars in needless failure to file penalties because they didn't file on time.
If you received a tax refund in April of 09 and filed a chapter 7 bk in June of 09 can they take your refund you receive in 2010?
No. It was not part of your "bankruptcy estate" as of the date of filing and is not one of the items that have to be reported if received within 6 months of filing. Especially… if you do file your return until April.
The tax refund goes into the bankruptcy estate. If your chapter 7 filing did not exempt the refund, the money will be used to pay the trustee and to pay your debts pro rata. T…hat is, each creditor gets an amount equal to the percentage the debt is to the total indebtedness. You are not likely to get anything back, but if all the debts are paid off 100 per cent and the trustee is not entitled to any more money, the balance will be paid to you. The trustee should have decided what s/he is going to do. If you have a lawyer, s/he should discuss it with the trustee. You can also talk to the trustee or your case manager. I doubt you will get any of the refund, but make sure to stay on top of the issue and get notices of any trustee motions regarding these funds.