Spending my tax refund...What is considered frivolous?

[lotsahats]

I've figured out that I won't be able to afford to file for bk until I get my tax refund next year. Actually, I understand that the trustee will be particularly interested in where my refund went. Admittedly, I want to keep it from becoming an asset, so letting it sit in the bank is out.

As mentioned, some of it will be going to the bk attorney. There is also some work that needs to be done on our car. After all that is done, would clothes for myself, or my kid be considered frivolous? What about Lasik surgery?

[HHM]

It is not so much a list of frivolous, it is easier to approach the issue from what is likely allowed. The key words for what is allowed are Necessary and Reasonable, the key word for what is NOT allowed is "improvement."

Car repairs, generally necessary. (new tires, yes; 20" chrome wheels, no). Lasik, probably necessary. Clothing, to a point, necessary; just don't go overboard. Buying clothes at Target, Kohl's, JC Penny okay, buying a new wardrobe at Nordstroms, not okay.

[daylate]

Why don't you change your withholding exemptions NOW to eliminate getting a refund next year? By changing now you will have 4 months of higher take home pay and possibly be able to file sooner rather than later. Anyone who is working and contemplating bk in the next year should never let themselves get a refund.

[tobee43]

we filed our bk in april. our atty said when you get your return spend it asap.

we did...it was over 8k and the trustee didn't ask one single question with respect to that refund as to where it went. ( it actually ended up going toward this house).

hhm has a sticky about oct. being the time the trustee really starts thinking about taking your tax refund..but i can't find it hhm???? where is that sticky????

[discouraged]

I paid attention to what everyone said and spent mine on,1. the lawyer, 2. Food & groceries to last for 6 months & 3. Car repairs. None of these were questioned and the great part was, I still have coffee, canned goods and bathroom 'stuff' to last me for quite a while. These were not questioned.

[lotsahats]

What if we opened a bank account in my husband's name only (but making me an authorized user), and had our joint tax refund direct deposited there? Since the credit cards are in my name only, he won't be filing bk with me. Would that be legal?

[discouraged]

I would do nothing that is risky and just the fact that you are asking should concern you. Search for tax refunds on the forum and see what others have to say. It's not worth a jail sentence to be 'risky' with the money. Plus, if there is anything shady going on, the trustee can allege that you are not entitled and possibly in a position of abuse. It's just not worth it to take the risk, IMO.

[lotsahats]

Yes, that's true. I was just wondering if it was any different from putting it in an ERISA qualified IRA, as is suggested in this thread, just to make it exempt. But, I suppose it could be construed as hiding an asset, which is not my intention al all.

Better to just get my car worked on.

[daylate]

Just to repeat-Why get a refund? You have time now to change your withholdings to increase cash flow and save money to pay an attorney. If you get a refund it is your "fault". End of the day you will have received the exact same amount of cash the timing will be different thats all and most importantly you won't have to explain if asked what you did with your refund.