Question about tax return, can we really keep it?

[msndsy]

Our lawyer finally filled our case today (chapter 7, no assets). When we signed the paperwork a couple of weeks ago, she said she protected our tax refund up to $1200. Our refund is $1000 (we filed our taxes the day before we signed our paperwork), so a little less than she listed as our exempt assets.
We have already recieved the check in the mail and it's just sitting here because I am scared to deposit it and spend it. Is it really safe to say that we can spend the money? There are a lot of things we need, like a new bed for one of our kids, new summer clothes for all 3 kids etc. I keep reading that the trustees want the tax returns. Besides the $1000 check sitting in my kitchen, we have nothing of value and don't own a home. We are in WA and I thought we can only have $200 in the bank and $200 cash when we file? Our lawyer has filed thousands of cases ( I checked on pacer,lol), so I do think that she knows what she is doing.

Thanks for any advise !!

[aachudneymiles]

Our lawyer finally filled our case today (chapter 7, no assets). When we signed the paperwork a couple of weeks ago, she said she protected our tax refund up to $1200. Our refund is $1000 (we filed our taxes the day before we signed our paperwork), so a little less than she listed as our exempt assets.
We have already recieved the check in the mail and it's just sitting here because I am scared to deposit it and spend it. Is it really safe to say that we can spend the money? There are a lot of things we need, like a new bed for one of our kids, new summer clothes for all 3 kids etc. I keep reading that the trustees want the tax returns. Besides the $1000 check sitting in my kitchen, we have nothing of value and don't own a home. We are in WA and I thought we can only have $200 in the bank and $200 cash when we file? Our lawyer has filed thousands of cases ( I checked on pacer,lol), so I do think that she knows what she is doing.

Thanks for any advise !!

Yes, if she exempted it correctly your free to do as you like. I exempted my own 6k. One more thing don't you trust your Lawyer?

[jp2861]

I was told the same thing by my lawyer. When I went to the 341 I was given back the tax forms and told I could "keep this". I interpreted that as I could keep the refund. 10 days later I got a letter saying I needed to submit the tax forms and don't spend the refund. I almost hit the floor when I read it because I already cashed and spent most of it. It was an honest mistake on my part, but I should have clarified right there at the 341 that I could not spend the refund. Like yours, mine should still be covered under the exemption, but it has me nervous as heck until I hear something from the trustees office.

The only difference is I didn't know exactly how much mine was when I filed. All I knew is I would be under the $1000 wild card.

So, If I was you I would wait until the trustee gives you specifics saying that you can keep, cash and spend it. Unless you trust your lawyer enough to go on what she says.

[aachudneymiles]

I was told the same thing by my lawyer. When I went to the 341 I was given back the tax forms and told I could "keep this". I interpreted that as I could keep the refund. 10 days later I got a letter saying I needed to submit the tax forms and don't spend the refund. I almost hit the floor when I read it because I already cashed and spent most of it. It was an honest mistake on my part, but I should have clarified right there at the 341 that I could not spend the refund. Like yours, mine should still be covered under the exemption, but it has me nervous as heck until I hear something from the trustees office.

The only difference is I didn't know exactly how much mine was when I filed. All I knew is I would be under the $1000 wild card.

So, If I was you I would wait until the trustee gives you specifics saying that you can keep, cash and spend it. Unless you trust your lawyer enough to go on what she says.

Is a Homestead required in your state to use the wildcard ?

When the trustee gave you back your tax return info and said you can keep this he was speaking of the paperwork "not your refund" he was returning the docs to you. I think see how it could be confused.

Let's put this in simple terms " If you or your lawyer did NOT exempt and listed the tax refund correctly (including filing a homestead deed etc whatever is applies in your state) then the tax refund is free game for the trustees taking. That's if he wants the refund- some abandon it.

So, if the tax refund was listed correctly and exempted correctly then the debtor is free to do whatever with it ( trustee can't touch it )

Once again do you trust your lawyer?

[jp2861]

It was listed on Schedule C but the amount was unknown at the time I filed. So it says unknown in the value column.

I don't see anything in the state statute that makes mention of any special requirements in order for the wildcard to be in effect.

I guess I just sit and wait it out.

[aachudneymiles]

It was listed on Schedule C but the amount was unknown at the time I filed. So it says unknown in the value column.

I don't see anything in the state statute that makes mention of any special requirements in order for the wildcard to be in effect.

I guess I just sit and wait it out.

Yeah, mines first said unknown then trustee made me change it to the amount of year refund of my previous tax refund 5k.. Wait if you dont trust your lawyer. I did my own BK so I knew he could'nt touch mines. Good luck

[msndsy]

I do trust my lawyer, she has filed thousands of cases of the years ( I think 3000 or more). She has it listed under exemption 11 U.S.C 522(d)(5). It's still sitting my kitchen though,lol.

[monkatom]

I exempted most of mine 8855 of a 10453 return. Trustee originally wanted to take the remaining 1598 then decided against it and declared us no asset. I have not spent it just in case but according to the lawyer unless we lied and hidden assets show up the entire return is ours.