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Filing taxes- Chapter 7 in Michigan

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    Filing taxes- Chapter 7 in Michigan

    Hello all, I am in the process of a chapter 7. I am married but my spouse has not filed. I have already had my meeting of creditors and my " Confirmation meeting" I believe it is called, is in February. I have received notice that now my 2016 Tax Refund, in which I havn't even filed yet, will be taken away per the Trustee. My spouse and I usually file jointly but I am wondering if we filed " Married Filing separately" will they take her refund also or say that we filed differently to keep from paying all our tax refund? My attorney is useless and I regret hiring him but I don't have the money to fire and get a new one. Thank you for your input.

    #2
    I think you filed a Chapter 7 and not a Chapter 13. As such, it's simply a 341 Meeting and not a confirmation hearing.

    Do not attempt to hide money from the Trustee by filing differently than you have in the past. That may just make them mad. I would file just as I normally did in previous years. You would need to seek legal advice if you wanted to do something differently (such as you suggest).
    Last edited by justbroke; 02-03-2017, 06:20 AM.
    Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
    Status: (Auto) Discharged and Closed! 5/10
    Visit My BKForum Blog: justbroke's Blog

    Any advice provided is not legal advice, but simply the musings of a fellow bankrupt.

    Comment


      #3
      My mistake, I'm in a chapter 13. I'm not trying to hide the money I want to keep the money to pay down some of my wife's bill and to have some emergency money. We're living paycheck to paycheck as it is and I'm tired of telling my kids we can't buy this or that and feeding them cereal for dinner time.

      Comment


        #4
        There are various realities that you run into when you realize that you don't have the money for everything that you need (the necessities). The main reality is, you may have to tell the children that we can't buy this or that. I had to find alternate things to do for the kids and we actually had more fun then, than we did after I received my discharge. You wonder why it was more fun before than after? Because when I didn't have the money and was on a budget, we did things like ride bikes on the bike trail nearly every weekend. We walked to the local parks and enjoyed them. We went simply to the beach and "hung" out and watched the street performers. We cooked meals together (no eating out). We even had days for different things... like "make your own pizza night" which was extremely popular.

        When you do get into a Chapter 13, you won't so much be living paycheck to paycheck, but you must budget and stay on budget. This may mean only being able to go to the movies, with the kids, or doing some other paid event with the kids, once a month. Trust me that I did this and it worked. It won't work for everyone and especially those that can't or refuse to budget.

        The Chapter 13 takes care of the creditors and you only pay what you can afford. Hopefully you have a decent attorney that will make sure you have cushion in your budget to allow you to save. It is somewhat difficult but not impossible to save in a Chapter 13. You just have to learn how to do things on budget. If you have a budget and stick to it, you'll have money to save for life's little surprises, not for life's little spending splurges; there is a difference.

        I can't tell you if they want your tax refund as that's a function of how your Chapter 13 Plan was created along with local rules and procedures. In some jurisdictions they take the entire refund. In other jurisdictions you get to keep the first $2,000 or so. In all jurisdictions, if there is a heavy financial need, you can petition the Trustee to keep the refund (but it typically requires a motion to keep refund filed through the court).

        If you just filed, you shouldn't be living paycheck to paycheck. There is an exception and that is where you're trying to keep property that you simply cannot afford. Look at your Chapter 13 plan and look at the budget (expense) categories. That is what you have to work with. If you can't work within those, sit down with your attorney and see if there is room to expand on them.
        Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
        Status: (Auto) Discharged and Closed! 5/10
        Visit My BKForum Blog: justbroke's Blog

        Any advice provided is not legal advice, but simply the musings of a fellow bankrupt.

        Comment


          #5
          I just filed and my kids and I had a Family Meeting about budgets. I obviously didn't tell them that I filed Chap 13, but we looked at the disposable income after paying Rent, electric, gas, phones, cable/internet, Netflix and did our Cash envelopes together. They understand we're on a budget and I hope that will make the decisions I have to make more understandable. My youngest came to me last night and asked to see the budget. Then, he said he didn't want to buy school lunch because it wasn't that good and "we're on a budget now." Did that break my heart? Yes. But it's encouraging to see them embracing a budget. I hope this will set them up to be financially responsible and not spend what they don't have.

          Comment


            #6
            newlife13 I love that story. In addition to "make your own pizza night" we also had "movie night". I allowed them to rent a movie once a week via the Apple TV. It was really a good time.
            Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
            Status: (Auto) Discharged and Closed! 5/10
            Visit My BKForum Blog: justbroke's Blog

            Any advice provided is not legal advice, but simply the musings of a fellow bankrupt.

            Comment


              #7
              Thank you for your responses. I will have to see if my attorney can expand on my budget but unfortunately I don't have much faith in her. The only property we are tring to keep is the house we live in, which is nothing fancy, our lease car, and a paid off minivan. I did finally got an answer from my attorney about being able to keep some of my 2016 tax return and stated that it has to be "for extraordianry circumstances (for example: unexpected home or vehicle repairs, medical expenses)." She also said keeping some of it to pay my spouses credit cards down/off doesn't qualify which does not make sense to me. Although she says that if we file " married file separately " she would be able to keep her refund. Hoping for the best in all of this. Thank you again.

              Comment

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