Sunday, January 29, 2023
HomeBankruptcyWhat occurs to my 2022 tax refund if I file chapter in...

What occurs to my 2022 tax refund if I file chapter in 2023?


You lose it, until you spend it first. When you look beneath, there’s a pretty complete record displaying how one can spend these refund monies.

(No, you’ll be able to’t put it aside. No, it’s not protected authorities support cash to you. You have to eliminate it earlier than submitting chapter!!!).

Annually, I replace this publish. Final 12 months, we had pandemic tax refund monies that modified the calculation. This isn’t the case in 2023.

Right here is final 12 months’s publish: What occurs to my 2021 tax refund if I file chapter in 2022?

Some states provides you with an exemption to guard your tax refund monies. Utah just isn’t considered one of them. In truth, in most states, it’s important to use it or lose it. When you’re uncertain, name a bk lawyer in your state and discover out.

I’ve written just a few articles on this, and the hyperlinks are beneath.

Whenever you file chapter, it’s the bk trustee’s job to find belongings that you’ve. Particularly, he needs to seek out belongings that may be bought off and used to pay your collectors. Usually, the trustee will take a look at fairness in your house, cash in your checking account, the worth of you automobile, and any tax refund monies that you’ve NOT acquired but.

Because of this it’s important to obtain and spend your tax refund earlier than you file chapter, or there’s a good likelihood that the bk trustee will intercept it and use it to pay your collectors.

Right here, I’ll attempt to provide you with a fast and soiled record of the do’s and don’ts of spending your tax refund monies.

Don’t:

  1. repay Mother and Dad earlier than you file bk
  2. purchase a brand new toy, like a dirtbike
  3. cover the cash and declare that you simply spent it
  4. purchase jewellery
  5. prepay hire

Do:

  1. purchase meals storage and clothes
  2. purchase boring family home equipment like washer/dryer/fridge/freezer/range/stitching machine
  3. purchase weapons (actually) (I can defend as much as 3 of any worth)
  4. pay for car repairs and tires
  5. pay your lawyer on your chapter

Pandemic stimulus tax funds and tax credit.

When you haven’t acquired these but, don’t fear. These are exempt from collectors, together with the chapter trustee.

Listed below are the previous weblog articles:

Spend it earlier than you go bankrupt!

Utah has NO exemptions to guard your tax refund while you file chapter. Because of this should you go bankrupt earlier than you obtain and spend your tax refund, you’ll lose it. The chapter 7 trustee will take your refund and use it to pay your collectors. Then again, should you wait just a bit bit to file and obtain your refund, you’ll be able to spend all of it earlier than submitting chapter.

Simply keep in mind to spend it on exempt objects.

You may positively use it to pay your chapter lawyer to organize your case.

Don’t repay buddies or household!  Name me in case you have any questions on the right way to spend it.  You may even textual content me on a Saturday at midday as you’re standing in an RC Willey attempting to resolve if you should buy the brand new $800 bunk mattress set for the twins (sure, you’ll be able to). You may textual content me at 801-787-8860.

The record is beneath, however you’re all the time secure with meals storage, clothes, washer, dryer, fridge, freezer, range.

Here’s a rehash of my publish on this identical concern final 12 months (and the 12 months earlier than):

What occurs to my 2018 tax refund if I file chapter in 2019?

What occurs to my 2017 tax refund if I file chapter in 2018?

What occurs to my 2016 tax refund after I file chapter?

It’s that point of 12 months once more the place I’ve to reply the cellphone and inform those that I don’t need their cash till February or later due to tax refund season.  It makes a lean December/January in our family, however it’s the one strategy to defend my shoppers.

(I’m reducing and pasting from earlier posts, so please forgive the repeat data).

So let’s say you get your refund February 1, 2016.   What do you do?

Higher stated, what don’t you do:

1.  Don’t go purchase a brand new toy like a mud bike or a television.

2.  Don’t repay any buddies or household.  It is a preferential switch, to an insider no much less, and it leads to Mother and Dad being sued by the trustee.

So what do you do:

1.  Spend it on exempt objects below Utah Legislation.  This principally means meals, clothes, washer, dryer, fridge, freezer, range.

(Did you see a pc on the record?  No.   Don’t ask me if that’s okay.  It’s not).

:)

2.  And use the remainder to pay me.  

So let’s say you spend the tax refund on meals storage March 1st and maintain your entire receipts.  When are you able to file?  March 2nd.

Here’s a related portion of the

Utah Exemptions Act, Utah Code Title 78B Chapter 5, Part 505https://le.utah.gov/xcode/Title78B/Chapter5/78B-5-S505.html

A person is entitlted to an exemption in …

(viii) (A) one:

(I) garments washer and dryer;

(II) fridge;

(III) freezer;

(IV) range;

(V) microwave oven; and

(VI) stitching machine;

(B) all carpets in use;

(C) provisions ample for 12 months truly offered for particular person or household use;

(D) all carrying attire of each particular person and dependent, not together with jewellery or furs; and

(E) all beds and bedding for each particular person or dependent;

There are different objects you’ll be able to spend the cash on, and that is certainly not complete, however this could provide you with a good suggestion on the right way to spend it.  If in case you have questions on what to make use of it for, ask your lawyer;  that’s what he’s there for.

RELATED ARTICLES

Most Popular

Recent Comments