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Category: Tax Refund

  • Tax Returns Can Be Used To Pay For Bankruptcies

    Call: 888-297-6203

    The time to pay tax is going to come soon. By January 31st, the employees need to get W2s from their employers, so that their federal income taxes can be filed. According to the Bank rate website, 30% of the people getting tax returns decide to use it to repay debt, and some of it to fund bankruptcies.

    It is beneficial to file for bankruptcy immediately after receiving the tax return because you get an opportunity to use your return on necessary and reasonable things instead of handing it over to your bankruptcy trustee. For instance, if a debtor was planning to file for bankruptcy in July, he or she would already earn half of the tax return for that year, which would then be asked for by the trustee. Thus, in order to spend your money well and protect it at the same time, it is better to spend it on necessary and reasonable things and then filing for bankruptcy.

    While it is advisable to file for bankruptcy before holidays, the fees of an attorney does count as an important and reasonable expenditure, allowed just before filing bankruptcy. Many debtors find it difficult to arrange money to pay their bankruptcy attorney’s fees. However, a tax return solves that problem.

    It is important not to spend the money on luxuries, which leads to bankruptcy. It is advisable to hire expert help to understand and plan out the bankruptcy prior to obtaining a tax return. You can contact the Recovery Law Group, best in Los Angeles & Dallas, TX, at www.staging.recoverylawgroup.com or on 888-297-6203.


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    • Tax Refunds And Bankruptcy

      When you are struggling with debt, thinking straight is not expected. While filing for bankruptcy, hiring skilled bankruptcy lawyers can help you deal with any issues which arise, later on, say lawyers of Dallas based bankruptcy law firm Recovery Law Group. One of the most common problems people face is a failure to remember tax refunds while listing their assets in bankruptcy schedules. Just like any other asset, income tax refunds should also be treated similarly, except that they are held by the government. The bankruptcy trustee has to deal with the tax refund depending on the month you file for bankruptcy. If you file in May, the trustee might have an interest in 5/12 of the next year’s tax return.

      While filing for bankruptcy, a debtor can protect their assets with the help of federal or state bankruptcy exemptions. Through these exemptions, you can protect a certain amount of property. however, you need to mention them while filing bankruptcy papers. Any objections to the exemptions need to be addressed within 30 days of bankruptcy filing through a 341 meeting. There are different strategies when it comes to handling tax refunds. These include:

      • Waiting till you get a refund and then filing for bankruptcy.
      • Spending refund on essential expenses like grocery, utilities, etc. and filing for bankruptcy.
      • Adjust your deductions to reduce the refund amount to an insignificant number.
      • Use the amount to cover the bankruptcy trustee’s interest in next year’s return.

      In case the exemptions can be used to save more money elsewhere, debtors can let go of the tax refund too. If you have doubts about how to protect your tax refunds, you can speak with experienced bankruptcy lawyers at 888-297-6023.


        *Are you more than 60 days past due on your mortgage?

        *Do you own a home?

        Are you currently working?

        By clicking “Submit”, whether I do or do not purchase any products or services on this website, I hereby give my express written consent to receive calls and SMS/text messages, including calls and SMS/text messages made and sent using automated dialing equipment and/or pre-recorded or artificial voice technology and email, about offers and deals that I wish to be kept informed about from (“Partners”), at the phone number and/or email address provided on this form, including any wireless numbers provided, even if I have previously registered the provided number on any Do Not Call Registry. If I do not make a purchase on this website, it is expressly understood that the Partners retain permission to contact me as specified earlier in this paragraph. Carrier SMS/MMS and data messaging rates apply. I also agree that by clicking “Submit” that I agree to the Privacy Policy and Terms and Conditions.

      • Tax Refund in Bankruptcy

        Tax Refund in Bankruptcy

        Call: 888-297-6203

        People who have filed for bankruptcy are often worried regarding whether they can keep their tax refund or not. according to lawyers of Los Angeles based bankruptcy law firm Recovery Law Group, it depends on which chapter you have filed, how much refund you will receive and what you intend to do with it.

        Chapter 7 bankruptcy

        In this case, tax refunds automatically become part of your bankruptcy estate and thus are handed over to bankruptcy trustees. this refund is then used to pay off your creditors. if you can get the tax refund exempted either partly or fully, then you can keep it. Bankruptcy allows certain exemptions to protect the debtor’s assets. you can use your exemptions to protect your tax refund if the need arises.

        Chapter 13 bankruptcy

        in the case of chapter 13also, tax refunds are part of the bankruptcy estate and need to be handed over to the bankruptcy trustee. The tax refund becomes a part of your disposable income since all your essential monthly expenses as well as planned payments can be executed through your monthly income. Hence, the tax refund is additional money which you do not require.

        However, you might be able to keep your tax refund if you can prove that you need it for some sudden but essential all-expense like medical bills or repairing or replacing any appliance/vehicle. a tax refund cannot be used to pay for utilities, food or any other regular expense which is covered by your monthly income.

        in case you’re worried about tax refunds while filing for bankruptcy, you should consult an experienced bankruptcy attorney at 888-297-6023 to know what your options could be.


          *Are you more than 60 days past due on your mortgage?

          *Do you own a home?

          Are you currently working?

          By clicking “Submit”, whether I do or do not purchase any products or services on this website, I hereby give my express written consent to receive calls and SMS/text messages, including calls and SMS/text messages made and sent using automated dialing equipment and/or pre-recorded or artificial voice technology and email, about offers and deals that I wish to be kept informed about from (“Partners”), at the phone number and/or email address provided on this form, including any wireless numbers provided, even if I have previously registered the provided number on any Do Not Call Registry. If I do not make a purchase on this website, it is expressly understood that the Partners retain permission to contact me as specified earlier in this paragraph. Carrier SMS/MMS and data messaging rates apply. I also agree that by clicking “Submit” that I agree to the Privacy Policy and Terms and Conditions.