As tax season approaches, it is important for you to understand how your tax refund will be treated if you file a personal bankruptcy case. Before you use your refund, you should schedule an appointment to discuss it with us. We can guide you in how to use your refund safely to reduce the chance of having your actions scrutinized by the trustee.
Your tax refund payment can be considered a part of your bankruptcy estate. This means that the trustee could require you to use it to pay your creditors, especially if you receive your refund while your case is pending. As a result, in some cases, it might be more beneficial to postpone your bankruptcy filing until after you have received (and spent) your refund.
Below are a few factors to consider when safely spending your tax refund:
- Always confer with your bankruptcy lawyer before spending your refund. We can help ensure that you get the applicable exemptions that will help you keep your refund while also obtaining the debt relief you need.
- Consider using your tax refund to pay for your bankruptcy filing fees, to pay your attorney fees or to pay for the required credit counseling and financial management courses.
- Use your tax refund to pay for “necessary expenses.” This includes items such as food, clothing, medication or certain repairs to your house or car. You may be allowed to use your refund to catch-up on delinquent payments on your mortgage or rent. Again, the best course of action is to confer with us so we can help you understand what types of payments will be the safest use of your tax refund.
We are here to answer your questions and guide you through the bankruptcy process. Don’t put your assets, including your tax refund, into jeopardy. Let us help you.
Contact The “Milwaukee Bankruptcy Attorneys,” DeLadurantey Law Office, LLC for all your Chapter 7 and Chapter 13 bankruptcy needs. Whether you need debt negotiations or debt relief, or even foreclosure defense, DeLadurantey Law Office will handle bankruptcy matters for the following locations – Milwaukee, South Milwaukee, West Milwaukee, Waukesha City, Waukesha Town, Kenosha, Racine, and all other municipalities in Milwaukee County, Waukesha County, Kenosha County, and Racine County. DeLadurantey Law Office, LLC can be contacted by phone at (414) 377-0518.