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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.

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โˆ™ 2006-03-04 17:25:24
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Q: How can creditors size a tax refund check one year after filing chapter 7 bankruptcy?
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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?

The trustee may take the refund and distribute it to creditors because a tax refund is not considered an exempted asset under bankruptcy laws.

Will you get your tax refund if you file for bankruptcy?

Whether you are entitled to your tax refund will depend on what type of Chapter of bankruptcy you are filing and whether the bankruptcy exemptions can be used to protect the tax refund. If you are filing for Chapter 7 bankruptcy then you can generally keep the refund if the available state bankruptcy exemptions provide protection for it. If you are in a Chapter 13 bankruptcy you are typically required to turn over the tax refunds during the life of the Chapter 13 case.

Can the bankruptcy court take your tax refund for 2004 if bankruptcy was filed in Dec 2004 if this was not discussed at the Creditors Meeting?

I think it depends on when your debts are discharged. If they were already discharged, it was a Chapter 7 bankruptcy, and it wasn't discussed at the creditors meeting, then the refund is yours. Besides, imagine if you filed on April 15th. You might not get your refund until later June or almost July, and that's months from when your debts were discharged. I'm pretty sure it's yours.

Do you get tax refund after bankruptcy discharge?

Depends on if your due a refund to start...and if it was taken from earnings before your filing or after.

Should you spend your tax refund before you file for chapter 7 bankruptcy?

If received for last year yes. the one for next year, received after filing, no.

What happens to your federal tax return if you filed chapter 7 bankruptcy?

Generally a portion will be included in as a non-exempt asset to be used to repay creditors. In some cases the entire refund can be seized, this depends upon the filing status and the time span between the two actions.

Will the bankruptcy trustee take all of your tax return refund?

I think it depends on when the bankruptcy is discharged, but it would be discussed at your meeting with the creditors and the trustee. If it wasn't discussed, then the refund is yours.

How long do it takes for a trustee to refund your tax refund after canceling chapter 13 bankruptcy?


Can a creditor take your income tax refund if you file Chapter 7 Bankruptcy?

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.

Can a trustee take your federal tax refund in Missouri if your bankruptcy was discharged before you filed your taxes?

The trustee may be able to take a portion depending upon the amount of the refund and the time frame between the filing or discharge of the BK and the date of the tax return. If a percentage can be ceased it will be pro-rated according to the number of months between the BK discharge and filing of taxes. In a chapter 13, the refund is not ceased but if it is of a considerable amount it may affect the payment amount assigned to the BK. But the money was generated BEFORE you filed for bankruptcy, so it's technically an asset that you already had and as such is to be factored in to the distribution to the creditors.

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.

Do you receive a refund if you owe one of the creditors on your bankruptcy?

No. The debt is simply discharged so you don't owe it.

Do have to file taxes if you are filing bankruptcy?

Yes, you do. And any tax refund may have to be given to the trustee.

If you do not owe the IRS will your refund been taken if you file bankruptcy?

It depends on the courts. I had a friend who went through bankruptcy and was owed a refund from the IRS. The trustee for the bankruptcy ordered her to turn over the refund to the courts to be paid out to creditors. So it could happen, but they cannot actually intercept or offset your refund. They will just order you to pay it to the trustee.

You just filed for bankruptcy and also got your 2008 refund will that be added to income in2009?

I filed my Federal taxes for 2008 and just received a refund and I am in the process of filing bankruptcy this month will that refund be added as income to the bottom line?

How can you keep your tax return when you file a bankruptcy chapter 7?

I assume you mean "how do you keep your tax REFUND when you file a chapter 7 bankruptcy?" A tax refund is an asset of the estate and, generally, the trustee will take it. There are two ways to avoid this, first way would be to delay filing your bankruptcy petition until after you have gotten your refund and spent the money. The second way is to declare part or all of the refund to be part of your exemption, however exemptions are small and most people have other assets (like computers, wedding rings, paychecks, etc.) they want to protect with their exemptions.

You expect a tax refund this year will filing chapter 13 bankruptcy in 2008 affect your refund?

The amount, no Will some part of it likely be used to pay your debts (because if you didn't have too much withheld that is what I'm sure you would have done with it then), yes.

If you received a sizeable tax refund but spent it before you filed bankruptcy will that money affect you?

The judge may ask you what it was spent on. Necessities such as food, shelter, utilities etc. are acceptable and a usual answer. You did the right thing. Receive and spend the refund before filing bankruptcy, if possible. Of course, is not always possible due to the stress from pressure by creditors. You should weigh the relief bankruptcy provides against the amount of stress you can live with.

Is it possible to exempt a tax refund in chapter 7 bankruptcy?

You can't "exempt" anything.

Will IRS still take your income taxes after filing chapter 13 bankruptcy?

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 dischargeable (due more that 3 years prior to the filing date).

If you get a large tax refund shortly before filing bankruptcy can you spend it?

You could, but they will find out about it and if you don't use this money to try and pay creditors then you could be in hot water. I would get some legal advice on this and meanwhile, put that money in an interest bearing account and don't touch it. Marcy * If the refund is received 60 days or less before the filing the entire refund is considered assets that must be included in the BK filing. If it is received more than 60 days before the filing the amount subject to BK is pro-rated.

What is the likelihood that a tax refund will be taken by the trustee during a bankruptcy?

Generally it depends on the type of BK when or if it has been discharged, the amount of the refund, and if it is a federal or state bankruptcy filing. As a rule at least a portion of the refund will be taken by the trustee, more likely the entire amount is subject to relinquishment.

If you filed bankruptcy in Dec of 2004 can you get your refund that has already been taken for 2002?

No, the IRS will get to keep it. And, even if you could get it back, the bankruptcy trustee would probably take it to distribute to your creditors.

Can you file for a tax refund while in a chapter 7 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 asset, 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.

Why does the court sometimes take the tax refund when a person files a chapter 7 bankruptcy?

A tax refund is considered income/asset belonging to the BK petitioner and is therefore subject to seizure for the repayment of debt. Whether or not the refund 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.