federal income tax refund

[jak71454]

I was told that a federal income tax refund is limited to $1600. My tax refund will be more than $1600 this year. What do I do? Will they take all of it or just the amount over $1600. Will they amount they take reduce my length of payments?

Thanks, Jim

[coma]

There is nothing specific regarding tax returns in the law, so this varies from trustee to trustee in reference to what they will take.

If you are in a 100% plan, then it would reduce the length. If you are paying less than 100% then your creditors just get more money.

[cj0203]

My atty said we (specifically us) could have up to $8k in the bank when we file and it should be safe. We are planning to file Ch7. She didn't seem too concerned with us losing any tax refund we get between now and when we file. But again, that was what MY atty told us we could have. Maybe call yours and see what they say?

[325Falcon]

It depends on weather or not you can protect the refund with an exemption.

[mesa777]

I was under the impression that you could only have $150.00 in the bank on the date that you file for bankruptcy... I am confused... $8000 in the bank???

[woohoogirl]

I was under the impression that you could only have $150.00 in the bank on the date that you file for bankruptcy... I am confused... $8000 in the bank???

I thought the amount you had in the bank could vary as long as you have an exemption to cover it. Here in TN we have a $4000 wildcard that is used to cover bank accounts, household goods, and automobiles. I thought I had read somewhere that the child tax credit and earn income credit were not included as a part of the bankruptcy estate, but when I Googled them today, all I found were cases that said the credit were not exempt from the bankruptcy estate. I'm assuming you meant that the $8k was from the tax refund...if not...ignore me I am babbling again.

[mesa777]

I have talked with two local Phx area attorneys whom advised that anyone that files BK cannot have more than $150.00 in the bank on the date of the filing....

[HHM]

Mesa...it just depends on the state's exemption laws regarding cash-on-hand.

[mesa777]

I cannot imagine that any state in this nation would allow someone whom is filing for BK to have $8000 on hand in a bank account.

[cj0203]

I thought it was high too, believe me!! But I specifically asked her how much cash/savings was OK, and she looked at our paperwork and said we'd probably be safe to keep up to $8k. Man, if we could only have $150 on the date of filing we'd be in trouble since we wouldn't have any CCs or anything to fall back on!

We don't have many assets to protect and barely dig into the exemptions, maybe that's why? I'm not sure, that why I said the OP should ask his own atty

[slam22]

I thought it was high too, believe me!! But I specifically asked her how much cash/savings was OK, and she looked at our paperwork and said we'd probably be safe to keep up to $8k. Man, if we could only have $150 on the date of filing we'd be in trouble since we wouldn't have any CCs or anything to fall back on!

We don't have many assets to protect and barely dig into the exemptions, maybe that's why? I'm not sure, that why I said the OP should ask his own atty

In California if you use system #2 as a married couple you are each allowed a $21,825 wildcard exemption for any property. In theory you could exempt $43,650 in cash or any type of property.