Tax Refund problem

[Tanque]

I just got home from a work conference. I had a letter from my lawyer and trustee saying and have to give him my Tax refund. Because I have never had to give it to him before. I had to spend it on some bills. What should I do? what will he do to me? please give me some advice. I am going nuts and it's friday and I won't be able to talk to my lawyer til monday.

thanks,
Tanque.

[justbroke]

Which tax refund, from 2008 (filed in 2009)? The Trustee can ask for your refund if there is overwithholding. When you create a Chapter 13 plan, you submit all of your disposable income to the custody and control of the Trustee.

You are going to need to work with your attorney. If it's for the tax refund from 2008 and you already spent it, you're going to need to come up with that money. The attorney should be able to help you structure a repayment with the Trustee.

Let us know how this goes.

[justbroke]

(double post)

[ccfriend]

I didn't pay my state taxes to the trustee because I thought it was only the federal ones I needed to pay. I went into the trustee's office and paid the amount owed and even though I paid it I am being taken to a hearing to see if they are going to dismiss my case. I am a bit nervous but my lawyer said as long as I show up it shouldn't be dismissed.

[77ford]

I did the same thing, I didn't send in my State refund from 2007 because I thought it was only Federal too. They just sent us a letter saying if we didn't send it in our case could be dismissed and at that time we only had three months left! I was like I've been paying on this for over 4 1/2 years and I get to the end and they're gonna do this to me! Luckily the refund was about $250 so it wasn't hard to come up with. But we sent it in and haven't had any problems. Now I'm two weeks away from making my FINAL PAYMENT!!!!!!! 5 LONG YEARS!!!!!!!!

[ccfriend]

I did the same thing, I didn't send in my State refund from 2007 because I thought it was only Federal too. They just sent us a letter saying if we didn't send it in our case could be dismissed and at that time we only had three months left! I was like I've been paying on this for over 4 1/2 years and I get to the end and they're gonna do this to me! Luckily the refund was about $250 so it wasn't hard to come up with. But we sent it in and haven't had any problems. Now I'm two weeks away from making my FINAL PAYMENT!!!!!!! 5 LONG YEARS!!!!!!!!

I spoke with the Trustee's office today and they told me that at the hearing the Trustee will with draw the motion. They told me that I don't need to even attend. I think I will just to be safe!

[Tanque]

Ok. I called my lawyer to talk about the tax refund. Before I got to the refund. I asked it that payment would make my me close to done. He said no. So I asked why because I got a annual balance sheet from the trustee and it said I owe $3800. He said I had 60 months. I thought that I hade 42 months. He also said that I was confused, but I was going off the info he gave me 3 years ago. is there a place online I can look for this info. is there a place I can call for advice? I don't trust him anymore.

[77ford]

https://www.13datacenter.com/index.asp

That is a link to the data center that has ledger of what you've paid in and other info. Yea refunds don't count as paid in. I thought that it would, but it doesn't, because my TOTAL PAID INTO PLAN didn't change after I made that refund payment.

[Tanque]

ok. When I look at my NDC all of my unsecured stuff have a principal of $0.00. I just have money on my secured. I'm so confused now. I was so happy cause I thought I was close to done.

[justbroke]

Ok. I called my lawyer to talk about the tax refund. Before I got to the refund. I asked it that payment would make my me close to done. He said no. So I asked why because I got a annual balance sheet from the trustee and it said I owe $3800. He said I had 60 months. I thought that I hade 42 months. He also said that I was confused, but I was going off the info he gave me 3 years ago. is there a place online I can look for this info. is there a place I can call for advice? I don't trust him anymore.

What most Chapter 13 debtors aren't told, either by their attorney or by the Trustee, is that when they take your refunds... that's "extra" money on top of what they call the "plan base". The tax refunds technically don't "count" towards paying down your plan base.

Unfortunately, many go through several years of thousands in tax refunds, think their "plan base" is paid, and then find that they are still in the same spot they would be without those payments.

[DEBTCHAINS]

I'm currently looking into a CH 13, and for the first time ever, my wife and I owe the IRS. (long story)

From what I just read above, wouldn't it behoove anyone going through this process to be as FLAT as possible come tax time? I'd have my tax person's ear a few times a year.

[lrprn]

From what I just read above, wouldn't it behoove anyone going through this process to be as FLAT as possible come tax time? I'd have my tax person's ear a few times a year.

Unless a Ch 13 filer's trustee is one of the rare ones who doesn't want tax refunds, then absolutely YES - it is most definitely in the filer's best interests to adjust withholdings to ensure they get as little refund as possible.

For those Ch 13 filers who have a trustee that allows filers to keep up to a certain dollar amount of tax refund, then those filers need to adjust their withholdings to be sure they get back a little less than the maximum amount allowed.

The main thing is to find out exactly how your trustee handles tax refunds, then adjust your withholdings accordingly.

Frankly, it's foolish to use the U. S. government as an interest-free savings account, Ch 13 or not. Time to get out of that habit, and fast!

[ccfriend]

Unless a Ch 13 filer's trustee is one of the rare ones who doesn't want tax refunds, then absolutely YES - it is most definitely in the filer's best interests to adjust withholdings to ensure they get as little refund as possible.

For those Ch 13 filers who have a trustee that allows filers to keep up to a certain dollar amount of tax refund, then those filers need to adjust their withholdings to be sure they get back a little less than the maximum amount allowed.

The main thing is to find out exactly how your trustee handles tax refunds, then adjust your withholdings accordingly.

Frankly, it's foolish to use the U. S. government as an interest-free savings account, Ch 13 or not. Time to get out of that habit, and fast!

My Trustee said that I am not allowed to adjust withholdings without his permission.

[Ckacrum]

I was told by my attorney that unless it was a large($5,000 or above roughly) return he would only ask for a couple hundred dollars. He said being under the median and a family of 4 he wouldn't hammer down because of our situation.

I mean, do I look stupid?? I will not forget that and if the trustee says other i'm calling out my attorney. Not like it would do any good, but it'll make me feel better!