To the extent a tax refund is accrued during the year of filing it is property of the estate. So, if you file mid year, on half of your refund will go to the estate. If you file after 2/3 of the year, 2/3 is property of the estate and 1/3 is simply yours. In Missouri, you have a small amount of property, such as cash, stock, tax refunds, property that exceeds dollar limitations (such a cars that have equity that exceeds what your state law allows as exempt; $3000 in MO). This is a "wild card" exemption. The "wild card" is a pretty low amount in MO. Without knowing more, it is hard to know if your tax refund would have fallen within your available wild card exemption amount. It is also hard to know what your layer could have done to protect your refund. It sounds like your lawyer did a bad job of warning you about the tax refund. It is hard to judge from afar whether there is anything that your attorney could have done to protect the refund. It may be a case of "no harm no foul." But also very disappointing communications. (Frankly, you should have had all of this explained to you by your lawyer before you filed. I would hate for one of our clients to feel so confused. I would also feel bad if our clients could not get a straight answer from us. I guess we are just old school.)
Answered on Feb 23rd, 2012 at 8:04 PM