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I am going to file bankruptcy and I read that if trustees will review my purchases within 6 months of fileing of more than $599. Will that deny my BK, I paid for my car to be fixed and paid with my taxes. Will that count against me?
15 ANSWERS
Burton J. Green
The trustee does review your filings. The trustee does not deny your bankruptcy, only the bk judge can do that. The trustee can question you about your purchases and can file an objection to your discharge if your purchase history is non-typical. The objection will be heard by the judge for a ruling. Having your car repaired is not a serious problem as long as you scheduled that repair in your statement of affairs. Using your tax refund is also OK as the money is yours if spent prior to filing for bankruptcy. I see no problem in your going forward with the bankruptcy if this is your only concern.
Answered on Jun 25th, 2012 at 4:58 PM
Barbara A. Fontaine
You must answer the questions on the bankruptcy form. If you just made ordinary car payments, that is not a problem. However, if you went and bought lots of items you don't need (expensive jewellery, trips, and boats) then they will look at your filing. I would guess that you are OK.
Answered on Jun 20th, 2012 at 5:46 PM
Bankruptcy Attorney serving Overland Park, KS
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The Smalley Law Firm, LLC
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It is unlikely the trustee will have a problem with a purchase over $600 if it was using your tax return to have your car fixed.
Answered on Jun 20th, 2012 at 3:19 PM
Criminal Law Attorney serving Fremont, CA
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Steven J. Alpers, A Professional Corporation
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That should not be a problem. You paid an expense needed to keep your car an asset for your bankruptcy estate.
Answered on Jun 20th, 2012 at 1:43 PM
Using a tax return to have your car fixed is not a problem in bankruptcy.
Answered on Jun 19th, 2012 at 8:41 PM
Commercial Bankruptcy Attorney serving Davie, FL
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Law Office of Jeffrey Solomon
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From what you are indicating, it does not appear that those types of items would be any problem. You should consult an attorney with any details.
Answered on Jun 19th, 2012 at 5:45 PM
2 Awards
No, the trustee may recover preferential payments to creditors but your car transaction is not a preference.
Answered on Jun 19th, 2012 at 5:41 PM
Criminal Defense Attorney serving Deltona, FL
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R. Jason de Groot, P.A.
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It will not count against you that you paid to have your car fixed from you income tax return. A trustee's job is to try to find assets that are not exempt from the claims of creditors and sell them off to pay your creditors a pro rata share of the proceeds. That's in a chapter 7. In a chapter 13 the trustees job is to receive money from you according to your plan and distribute it to creditors. Neither has the ability to deny your bankruptcy.
Answered on Jun 19th, 2012 at 5:37 PM
Bankruptcy Attorney serving Phoenix, AZ
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Law Office of D. L. Drain, P.A.
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You are fine if that is all you did. The real issue is whether or not paid any family back money that they lent you, or transferred assets for less than their fair market value. Understand that bankruptcy is a very complicated process. It is wise to talk to an experienced bankruptcy attorney before deciding to take this important step. Most Arizona bankruptcy attorneys offer a free consultation about the basics of bankruptcy.
Answered on Jun 19th, 2012 at 5:34 PM
No. You are fine. If you gave away your money or paid bills from the past (not a current expense like fixing a car) the creditor to whom you made the payment will have to give the money back.
Answered on Jun 19th, 2012 at 5:34 PM
Consumer Bankruptcy Attorney serving Los Angeles, CA
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Orantes Law Firm
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I cannot imagine a scenario under which your having paid to fix your car with your tax refund would be a problem. Perhaps if it is a particularly luxurious car and your bill was exceptionally large. In any event, while some trustees will ask to see some information about your paying habits for 6 months prior to the filing of the petition, most do not ask for that information and even if they ask for it, as long as you are honest and forthcoming with the information, it tends to be a non-issue.
Answered on Jun 19th, 2012 at 5:33 PM
Bankruptcy Attorney serving Concord, CA
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William Rubendall Attorney at Law
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If you pay more than $600 to any unsecured creditor the trustee may ask that creditor to give to money to the bankruptcy. Paying for a car from an income tax refund will not be avoided by the trustee.
Answered on Jun 19th, 2012 at 5:29 PM
Mobile Home Law Attorney serving San Juan Capistrano, CA
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Corfield Feld LLP
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Good question and you are right to look at that issue. Your car repair is a very reasonable expense, especially in our state. The court is looking for evidence of high living, especially high living instead of paying your creditors. The thought goes - why should you buy a new TV and not pay your creditors.
Answered on Jun 19th, 2012 at 5:25 PM
Family Law Attorney serving Hackensack, NJ
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The Law Offices of Stuart Jon Bierman
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I don't know for sure, but I think this will not be an insurmountable problem since you did not use a credit card or a creditor's money and the expenditure seems reasonable and necessary. You should be sure to have a good lawyer and make sure that he or she knows about this issue while the petition papers are being drawn up. Good luck to you and I hope that you will get a fresh start in your financial life.
Answered on Jun 19th, 2012 at 5:19 PM
Bankruptcy Chapter 7 Attorney serving Fort Collins, CO
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The Salas Law Firm LLC
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No , that should not cause your case to be dismissed, but remember to keep receipts on all purchase you made from the tax refund.
Answered on Jun 19th, 2012 at 5:15 PM