Means Test and Tax Refund

[Railspike]

I saw a post on here that indicated the tax refund is not necessarily counted as income on the means test. I'd like to get more discussion on that.

Is it, in fact, "income?" If not, when is it not?

Spike

[SinkingFast]

We didn't have to cover that issue with our attny. We OWED for 2005.

I would think a tax refund could be considered income tho. It's really earned wages deferred from the previous year.

[anonymuse]

Most trustees want that refund in their hands; however, whether it is considered part of your 6-month pre-filing income may be another story. Just because you receive it in one lump sum doesn't mean you didn't earn it over the whole year. However, my gut feeilngs is that it wouldn't be included in income since in my lawyer consult, the attorney asked about it, but didn't include it in my income.

Have you received the refund yet? Do you have any outstanding taxes? If you've got both, apply the refund to your outstanding taxes.

[no_it_all]

I saw a post on here that indicated the tax refund is not necessarily counted as income on the means test. I'd like to get more discussion on that. Is it, in fact, "income?" If not, when is it not? Spike

Tax refunds are never considered income. If you make $1000 per month for a year your income was $12,000. If you received a refund for overpayment of taxes to the tune of $2,000 did your yearly income now grow to $14,000??

The error most people will make on the Means Test is to claim their Monthly Tax liability by using their paycheck stubs, which are never correct. Instead you should use your completed 1040 or estimate using Federal and State tax tables.

[krobin02]

My refund and tax filing was nothing nothing more to my trustee than another piece of paper he wanted to see. In Ohio $400 in tax refund is exempt and my refund was around $800 combined federal and state. I guess my trustee didn't think that the $400 he could have taken was worth it since that is all he would have gotten from my "estate" in total.

[miss puff]

So, in reading this, would I assume that I would not have to list a tax return I got this year on section 02 of the statement of financial affairs? I am just checking my work for the millionth time because I am ready to run up to the courthouse to file. Kinda terrifying me-I have spent about 3 1/2 weeks on this paperwork and I feel some sort of insane bond with it that when I hand it over I am going to be biting my nails down to the quick wondering if I missed something.....

[no_it_all]

If you are referring to form B7, line number 2, then you are correct. Your gross monthly income was documented on some other form, as was your monthly tax liabilities...