I'm confused about the refund. Yesterday during our consultation, the lawyer told us to spend our return-that it would look really bad to have it sitting in our savings account-which is where we were going to put it because we were afraid to spend it. I'm still afraid to spend it, so I'm thinking we will take it out of our account and put it in a safe, I guess. Maybe the law is different in California? We filed our taxes on Sunday and will get back $7500.00.
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Retained atty 3/2010. Filed Chapter 13 on 1/2013. -
Though I wonder how much is too much pertaining to government interest... 1984? Ga. government is looking at doing substance testing for people on unemployment and welfare and require the testee to pay for the testing ,if they pass this law there. They said its for the taxpayer but I wonder about too ,saving government money, more for their benefit than the taxpayer.And if it happens there, other states will follow. Because look at all the taxpayer already foots the bill on, and no one stops this.Bank bailouts, etc. Whats next testing for social security pensions? And not to mention the federal government wanting into everyones healthcare. And if they do, what about all of the medical information they would have on everyone and who else could have access to it and use it for housing decisions, employment, credit etc.. Though it would be unlawful, how would one really know, and if you did, how could you prove it. Not to mention the penality for not having insurance, if you can't pay for the insurance, how are you going to pay the penality ? Just as filing bk and its public record anyone can access it.. ..make a housing, car,employment, credit decision..just makes me wonder how much is too much. And at what price
Last edited by broke20; 03-17-2010, 03:21 PM.Comment
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I guess from what our lawyer told us because its federal court ( kinda like the IRS ) they can consider your tax refund an asset unless you can exempt it. I would think as long as you spend it before filing bk, but then how much time has to be elasped from spending all of it and filing bk? Because it still depends and up to the trustee what to do with it unless its exempted as our lawyer told us. I would think as long as you have receipts to prove you spent it all on living expenses. But in this economy you still want some kind of a safety net for yourself but I don't know about having it all in a bank account ... because you would have to give account to the bk court... and the same if it were in a safe..Originally posted by sheilaE View PostLast edited by broke20; 03-17-2010, 03:23 PM.Comment
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Having it in a safe doesn't protect it. You have to claim amount of "cash on hand" which includes money not only in bank accounts, but in your wallet, under your mattress, in a safe deposit box, etc. You have to turn in your taxes when you file, and they will ask you where that money went. Lying = fraud. Spend it on necessary expenses or deposit it in an IRA if you can't exempt it.Originally posted by sheilaE View Post
You may even want to spend some of it on a down payment for a new car (or taxes/fees) because you don't want to head into a chapter 13 with old cars....
That said, CA has a very generous wildcard exemption, so if you're not using it on other assets already, then you may be able to exempt a good portion of cash. Be sure to ask your attorney.
We got our tax refund of $5400 the week that we filed (received Monday, filed the following Sunday) and our attorney told us that we had to spend it down so that we had less than $1100 cash on hand on the date we filed. We paid our mortgage a month early, electric bill early, cable/internet/phone, paid a year's worth of car insurance, stocked up on medicine for our son, bought a prepaid gas card, did a month's worth of grocery shopping, etc.
So we essentially spent our tax refund on our living expenses for the next month, and then spent our paycheck on what we would have spent our tax refund on, kwim? It's a numbers game...Filed Chapter 13 on 2-28-10. 341 completed 4/14/10. Confirmed 5/14/10. Lien strip granted 2/2/11
0% payback to unsecured creditors, 56 payments down, 4 to go....Comment
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Broke 20-those are some good questions that I plan on asking our lawyer-because we have yet to file. It could be months before we do. Just recently stopped paying cc.
Momofthree: I LOVE how you spent the return!Gas card-what a great idea!
I LOVE this site-I'm learning soooo much!Retained atty 3/2010. Filed Chapter 13 on 1/2013.Comment
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