Filing Bankruptcy AND Saving Your Tax Refund

 

Each year around this time there’s a common question I hear, “if I file bankruptcy will they take my tax refund?”  The answer, as with everything else, gets complicated.  While the tax refund is an asset that the trustee can take, in most cases planning and following my advice can  allow you to keep most if not all of your refund. 

First, generally, your entire refund is not at issue, only those amounts over the earned income credit and child tax credit.  Our well organized bankruptcy petitions help guide the trustee to these credits and lower the amount he or she is looking at.  Next, you can use your refund for several different types of ordinary expenses like food, utilities, home/car maintenance, education, rent/mortgage.  Note I didn’t mention putting your refund towards unsecured credit card, medical or collections bills.

You can also utilize your refund to pay for the bankruptcy itself! You can pay for both the court costs and attorneys fees, in fact it’s one of the most common ways of paying for bankruptcy.

Wright & Schulte LLC is dedicated to the belief that America’s legal system should work for the people. Every day, the attorneys of Wright & Schulte LLC stand up for the rights of people who are struggling to keep up with the high costs of living and out of control creditors. If you’re looking for a law firm that will aggressively and personally represent you as you deserve, do not hesitate to contact Wright & Schulte LLC today. Free case bankruptcy evaluations are available through the form on this page or by calling 1-937-435-9999.

 

–          Erik R. Blaine, Esq.

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