Could this happen?? After discharge?

[Filedat22]

I originally filed chapter 13 in March 2007. I converted to chapter 7 in September 2007. I received a standard discharge and my case was closed in December 2007. We just got a tax return of almost 7000. My husband (didn't file, I filed alone) is expecting a bonus next week of about 8400 after taxes. I am so nervous that the trustee is gonna come calling with his hand out for my half of these amounts of money, that I am insisting to my husband that we put half of everything in savings for about a year just to play it safe. My question is am I being overly cautious? Could or would the trustee come back this long after discharge and closing and ask for bank statements or money? My husband thinks I'm being paranoid...
Thanks!

[lrprn]

Your case is closed. If your trustee had been interested in your tax return, he/she would have left your case open to see how much you got back. That didn't happen. Also since your husband didn't file, the court could not take any of his bonus anyway. There's nothing to worry about....well, just one thing....

You need to figure out how to *not* use Uncle Sam as the world's lousiest savings account this year. Unless the size of your return was a one-time event, giving $7,000 of your money to the government to use tax-free for a year while you could be getting interest on it or having it available in case of emergency makes no sense.

Now's a good time to sit down with your husband and sort out exemptions and other approaches to reduce that return in 2009! Here's a good place to start - http://www.irs.gov/pub/irs-pdf/p919.pdf . Good luck!

[Teddy]

I agree with lrprn about letting them use your money all year! My mom taught me years ago not to do that. I know lots of people just do it because they like the refund and if they had the money, chances are they wouldn't save it.

I need my money thru the year so I have my deductions figured as closely as possible so I get a small refund or even owe. I just don't like the idea of THEM using MY money!

[rfassett]

I am always tickled when I ask people how much income tax they paid last year and the response is "I didn't pay anything, I got a refund". Writing a check or getting a refund have very little to do with the amount of tax paid. How much of your hard earned dollars did the government take and keep - that is the question. Did you know that tax free day for the average American is now well into the middle part of June? But I digress, yes, do as the others say and don't let the government use anymore of your money than is permitted by law.

[twuoo]

Where do you go to figure out your taxes?

I heard if you get less than $500 refund, then that's ok. Anything more, as you folks mentioned above, is rediculous.

[JRScott]

Some good sentiments here, Virginia Foxx from North Carolina has introduced legislation to end the current tax system imposed in 1943 where they automatically deduct the money from your paycheck. Instead you'd have to write a check at the end of the year and mail it in. She says that it would help Americans understand how much we really pay in taxes, and I agree.

However as stated earlier to the OP, if your account is closed they will not come after the bonus or tax refund. If however you were to say win the lottery or some other windfall increase they could reopen it then up to a year after.

You actually have the right idea. Bankruptcy means we need to make a lifestyle change. Saving money is one of those things, we can create a cushion for the things we used to use credit cards for with savings. Most economic advisers suggest 3-6 months worth of expenses in savings.