tax refund

[okiemom2008]

Does your tax refund count as income?

If so, I was thinking if you file your taxes the same month you file bankruptcy then it won;t count since they take the previous 6 months income and not the month you file?

[BnkrptcyLwyr]

In general, your tax refund is a return of your (previously earned income).

One thing that does need to be done ... you must list the refund as an asset, and if you can (depends on what state you live in) you must seek to exempt the refund.

Here in Michigan we can use the federal exemptions which (generally) provides more than enough exemption to exempt the refund.

[jribe]

Does your tax refund count as income?

If so, I was thinking if you file your taxes the same month you file bankruptcy then it won;t count since they take the previous 6 months income and not the month you file?

"income" is generally defined as anything that would be included on your taxes as taxable income. Obviously, you don't pay taxes on your refund; and it's money you have overpaid. So they won't count toward your 6 month income. But like the above post said, you'll need to make sure you can exempt it. If not, i would say to file and get as close to "0" as possible, then file an admendment later, after your discharge. (assuming you're a chap 7)

[laurannm]

There have been some members on this board on which the tax refund counted as income (per the UST). It doesn't seem to be common but it does count as income in some districts.

[okiemom2008]

There have been some members on this board on which the tax refund counted as income (per the UST). It doesn't seem to be common but it does count as income in some districts.

I was wondering because I was reading " Bankruptcy for Dummies" and it said income and gifts(cash) counted as income. My lawyer told me that gifts did not count as income.

[Over our heads]

I'm thinking that maybe it might be different state to state? This topic had me so worried that I bugged my lawyers office until I got a real person on the phone. She said that here (kc) our refund does not count as additional income because we already earned it.

If it did count as income, we would have to file before we recieved it and basically hand it all over as this district trustee is notorious for taking every last dime they can so we've been told. I also think that MO exemptions stink hard, so we wouldn't be able to save much of it.

On the bright side, I was told that I could get my home painted, inside and out and that is considered reasonable upkeep! Yay me!

[laurannm]

I was wondering because I was reading " Bankruptcy for Dummies" and it said income and gifts(cash) counted as income. My lawyer told me that gifts did not count as income.

Technically gifts do count as income, but that also seems to vary from state to state, trustee-to-trustee. I would go with what your lawyer says

[StartingOver08]

On the bright side, I was told that I could get my home painted, inside and out and that is considered reasonable upkeep! Yay me!

Wow! That's really good. You never know what the Trustee's will do with some of these items.