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Tax refund in Chapter 13 with 100%

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    Tax refund in Chapter 13 with 100%

    Today I had my 341 meeting, and for my surprise, even that I am in a 100% plan with 60 months, the Trustee said that I need to give back all my Tax refunds. I was hoping to keep my tax refunds. Is this normal? I know it will help to finish earlier that 60 months, but as my payments are very high, i was hoping to use my tax refund to help me with my monthly expenses. Does anybody know if it is possible to request not do give the tax refunds during the payment plan? Thank you

    #2
    As I have just found out over the last few days, different states have different rules regarding tax returns. What did your lawyer say on the subject?
    Latent car nut.

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      #3
      You should talk to your attorney. As I write about all the time, both Chapter 13 Trustees and even debtor attorneys will nearly insist that you have to pay "all" disposable income (DMI) to the custody and control of the Trustee in a 100% plan. That is not the case. However, I don't know if anyone knows 100% if you're in a 100% plan or not. Student loans and cramdowns (valuations, lien strips) usually cause the plan to not be a 100% plan.
      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.

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        #4
        justbroke I am sure, I am in 100%. I do not have any other debt (student loans, violations, taxes, etc.) except my credit cards and personal loans. My plan is basically all my debt plus 10% for the trustee plus 2% for the credit cards divided by 60. First the trustee was asking to give also 1/3 of my yearly bonus. But my attorney said, that i am in 100%, so he agreed not to add the bonus. But for the tax returns he said all has to give back.

        shipo I didn't have time to talk to my attorney, I will ask tomorrow.
        thank you for the feedback.

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          #5
          I just filed in January, and my 341 meeting is coming up in March. I am in a 100% plan. Whatever is claimed, I promised to pay 100% back of it, regardless of length of plan. My attorney has said I won't be asked to turn over my tax refund but will need to turn over my tax refunds every year that I am in bankruptcy. I'm also not being asked to turn over all my DMI to the plan (so far, fingers crossed) as my payments over 60 months will take care of my debt.

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            #6
            I spoke with my attorney today. He said that I need to wait to see the list of the objections. My plan was based on not including the tax refunds. Once we get the objections, he will act on them. He doesn't guarantee that it will happen, but he had cases where he was able to make it happen.

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              #7
              anunezal - good luck to you. This is all a process that can take a bit of time....I hope it works out for you.
              Filed Chapter 13 - 07/20/12
              Discharged 8/2/16

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