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    Tax Refund

    Hi,

    I have been in the ch13 for 3 years and everything is going smoothly. I can say not a single issue except a few times being very low on funds before payday. This tax year I am expecting a refund. I looked over my documents and all it states is to provide a copy of the tax forms each year. There is nothing about paying the trustee any refunds. I am not at a 100% payback. My attorney said the trustee allows to keep the refund but there is nothing that states I need to pay or I get to keep. Should I hold on to the refund once I get it incase? When the trustee receives my forms he will see I got a refund. I am getting back a little over $3,000. Thanks.

    #2
    If your plan doesn't mention paying some or all of any refund you might get, then you're good to go. Most folks live in jurisdictions where some arbitrary amount can be kept, and any amount above which must be turned over to the Trustee, others need to turn over the entire refund. In both cases, what must be handed over is explicitly spelled out in the plan agreement.
    Latent car nut.

    Comment


      #3
      Originally posted by shipo View Post
      If your plan doesn't mention paying some or all of any refund you might get, then you're good to go. Most folks live in jurisdictions where some arbitrary amount can be kept, and any amount above which must be turned over to the Trustee, others need to turn over the entire refund. In both cases, what must be handed over is explicitly spelled out in the plan agreement.
      Thank you for responding. My confirmation does not state that I must pay the trustee my refund, does not state to report an increase in income, and basically does not state much at all. Just my payment plan and that I must provide a copy of my tax documents. That is it. Kinda scary that it is only one page and no other details. I provide a copy of my tax documents every year and one year my pay increased $15K which showed on my taxes but never heard anything. Makes me wonder if the trustee just cares about the original plan and no modifications. My plan does increase an additional $400 per month for the last year per the original plan.

      Comment


        #4
        Sounds like you're good to go!

        And by the way, welcome to the site, there are many folks here with HUGE experience and are ready, willing, and able to offer advice; if you have any more questions, ask away!
        Latent car nut.

        Comment


          #5
          Originally posted by shipo View Post
          Sounds like you're good to go!

          And by the way, welcome to the site, there are many folks here with HUGE experience and are ready, willing, and able to offer advice; if you have any more questions, ask away!
          Thanks. I have been on this site before and was helped a lot when I was starting. Everyone on this site is awesome with so much knowledge. Have not been back in a year and a half and the system did not recognize my username, password, or email. Had to create a new account. This site and the information from everyone has been a lifesaver. Just trying to finish my last two years with no complications. Have not had one issue to date. I was nervous about my security clearance renewal but that came back adjudicated with no issue. I was asked about the reason for the BK but once explained all seemed ok. This has been a positive experience for me and learned a lot.
          Last edited by crazytimes; 02-14-2021, 09:41 AM.

          Comment


            #6
            At least here, in Florida, the Chapter 13 Plans are quite specific with requiring a copy of the tax return and surrender of any refund to the Trustee. If your attorney says that your Plan is quiet on that issue then that means that you are not required to surrender any refund to the. Trustee.

            This may be for two reasons. Either your Trustee doesn't care about the refunds or that your attorney used your average refund and already factored that into the plan. Since you are required to send a copy of the tax return to the Trustee each year, they will likely review it only to see if you made significantly more money year over year. Don't ask me what qualifies as significant, but we like to use 10% as a general guide.
            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

            I am not an attorney. Any advice provided is not legal advice.

            Comment


              #7
              Originally posted by justbroke View Post
              At least here, in Florida, the Chapter 13 Plans are quite specific with requiring a copy of the tax return and surrender of any refund to the Trustee. If your attorney says that your Plan is quiet on that issue then that means that you are not required to surrender any refund to the. Trustee.

              This may be for two reasons. Either your Trustee doesn't care about the refunds or that your attorney used your average refund and already factored that into the plan. Since you are required to send a copy of the tax return to the Trustee each year, they will likely review it only to see if you made significantly more money year over year. Don't ask me what qualifies as significant, but we like to use 10% as a general guide.
              It is strange that my paperwork doesn’t even mention anything about increases in income.

              Comment


                #8
                Originally posted by crazytimes View Post
                It is strange that my paperwork doesn’t even mention anything about increases in income.
                I don't believe that I've ever seen or heard of a Chapter 13 plan that does mention increases in income. It would be up to the Chapter 13 Trustee to detect the increase, and to then motion for the modification of the Chapter 13 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

                I am not an attorney. Any advice provided is not legal advice.

                Comment


                  #9
                  Originally posted by justbroke View Post
                  I don't believe that I've ever seen or heard of a Chapter 13 plan that does mention increases in income. It would be up to the Chapter 13 Trustee to detect the increase, and to then motion for the modification of the Chapter 13 Plan.
                  Me either. My confirmation is only 1 page

                  Comment

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