Tax Return - Timing - Unexpected Refund

[bumblefuss]

Ok, I've been on these forums for quite a long time and found lots of useful info (which is greatly appreciated).

Finally retained an attorney and the case was filed on 12/31 in TX (in case that matters).

At the time, I believed I was going to get a minimal refund or possibly owe some to the IRS (I was looking at + or -$50) based on what I knew.

I didn't know that starting college would qualify me for the Hope credit, which, if my (or TurboTax's) math is right, will result in a refund of about $1,600.

Fantastic. . . wait, CRAP! Of all the timing. . .

So I figured this whole refund thing out a little over a week ago and our 341 meeting was last Monday.

I called the attorney before the meeting and asked him about whether I should wait to file. He said go ahead and file, wouldn't be a problem.

Ok, so being the overly-cautious person I am, I wait for the meeting to pass, just to feel a little more comfortable.

Get to the meeting and I have to sign a form, which I guess everyone does, confirming this and that - and then I see a line saying that I am agreeing that I'm not expecting a tax refund (or something to that effect).

This, of course, makes me nervous. I sign it, because the data I have is still a projection since I don't have my actual W2 yet.

In my mind, it isn't final so I guess it could change, but what really got me was being cornered by that form right before the meeting, not knowing that would be on it. I'd have figured that my attorney would have briefed me on that since, you know, I had just asked him about it a few days before.

So now what? I was going to wait to file until after the last date for creditors to file an objection (3/28) before I files, but after all that I have no idea what to do.

Do I file now? Do I wait? Do I give up on claiming the Hope credit?

Sigh. Any suggestions?

[deadbroke99]

I was just told today by my tax lady that you can only qualify for Hope credit if you go right from High school to College. I didn't know that as I have went back to school after being out 15 years. Make sure you read up on that. I did qualify for some other type of credit where I get 20% of my tuition back.

[AngelinaCatHub]

OP, I know this has been said before, but ask your lawyer. In my opinion and ask my wife means little, but you are getting a payback for educational expenses. This could negate any complaint. Try it. Let us know. 'Hub

[liz417]

I was just told today by my tax lady that you can only qualify for Hope credit if you go right from High school to College. I didn't know that as I have went back to school after being out 15 years. Make sure you read up on that. I did qualify for some other type of credit where I get 20% of my tuition back.

No true, we've used the Hope credit for years now...

[deadbroke99]

No true, we've used the Hope credit for years now...

I am going to look into this because she is a CPA and told me that today.

[Trixie007]

No true, we've used the Hope credit for years now...

I agree... I qualified for the Hope Credit last year, when I was 37... it came as a surprise to me too! To qualify, you have to be considered a freshman or sophomore I believe, and there's a limit to how many years you can claim this credit.

[deadbroke99]

maybe that's what she meant because I have been to college before, Maybe I misunderstood.

[Trixie007]

This, of course, makes me nervous. I sign it, because the data I have is still a projection since I don't have my actual W2 yet.

In my mind, it isn't final so I guess it could change, but what really got me was being cornered by that form right before the meeting, not knowing that would be on it. I'd have figured that my attorney would have briefed me on that since, you know, I had just asked him about it a few days before.

So now what? I was going to wait to file until after the last date for creditors to file an objection (3/28) before I files, but after all that I have no idea what to do.

Do I file now? Do I wait? Do I give up on claiming the Hope credit?

Sigh. Any suggestions?

It sounds to me like you had a pretty good idea at the time that you will be getting a tax refund. Also, don't the Trustee's usually ask for a copy of your tax return when it gets filed? Seems to me I've seen that mentioned a lot on this forum. I don't know if it would even affect your BK, but if it were me, I'd let everyone know and let the chips fall where they may. Not worth fouling up the whole BK for $1,600. Sorry, just my opinion, and you did ask...

[bumblefuss]

It sounds to me like you had a pretty good idea at the time that you will be getting a tax refund. Also, don't the Trustee's usually ask for a copy of your tax return when it gets filed? Seems to me I've seen that mentioned a lot on this forum. I don't know if it would even affect your BK, but if it were me, I'd let everyone know and let the chips fall where they may. Not worth fouling up the whole BK for $1,600. Sorry, just my opinion, and you did ask...

Well, yes and no. At the time it could have gone either way. I always check, double check, and triple check my return before I file. Every so often I catch a mistake that would impact my refund, so until this morning, I wasn't totally sure.

No need to apologize for providing your opinion. I'm not the type to aggravated if he doesn't get an answer that's in my favor (ok, well, the outcome of the bankruptcy itself would be an exception to that).

I think I'll call the attorney Monday and tel him, "Per our discussion, I have filed my tax return and will be receiving a refund. How does this affect the paperwork I signed at the trustee meeting? How will this affect the conclusion of the meeting next month?"

As for filed tax returns, yes, they do ask for those, but my understanding was that because we filed on 12/31, only the prior 4 years were applicable. Anything filed after that really should be irrelevant. Again, that's just my understanding. I could be wrong.