QUESTION
How can I keep my tax refund and file a chapter 7 bankruptcy
Asked on Feb 13th, 2013 on Bankruptcy - Florida
More details to this question:
I'm filing bankrupcy at the end of the month but haven't filed my taxes yet. I will receive a refund of about $2000. I'm a small business owner (SP) and can't afford to lose the money. Can I put it in a IRA or roll it over in my taxes for next year since I'll have a 2nd mortgage that has been forgiven and will need to pay taxes on 20K?
1 ANSWER
It depends on when you anticipate the refund, how much the refund will be, whether it is a joint or individual bankruptcy filing, and an individual or joint tax return.
Generally, you want to get the refund first. You can use it for necessary expenses, legal fees and court costs. If you plan on receiving it after filing, then you may be able to exempt part of it from the bankruptcy estate. This would depend on a number of factors dealing with you other assets Spend a little time with a good bankruptcy attorney and he/she will provide the necessary guidance.
Answered on Feb 13th, 2013 at 3:34 PM