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I have my chapter 7 bankruptcy discharged a month ago and received my tax refund (e-file).

Seattle, WA |

Do I have to let my court know about it? my debt was mainly credit card.

Attorney Answers 4

  1. Best answer

    You may be under an "Income Tax Turnover Order" (which is entered in every case in the bankruptcy court where I practice) and you may have received verbal instructions from the Trustee at your 341 hearing. Depending upon when your bankruptcy petition as filed and whether any part of your refund can be exempted, the Trustee has a valid claim to some or all of that refund. Further, if your case is a no-asset case otherwise the Trustee will only enforce surrender if the estate's share is large enough to justify administration. Ideally, you are represented by counsel who will be available to advise more precisely on this issue.

    Best wishes for an outcome you can accept, and please remember to designate a best answer.

    This answer is offered as a public service for general information only and may not be relied upon as legal advice.

  2. The court doesn't care, but your trustee may. Your prospective refund should have been disclosed as an asset on your Schedule B and exempted on Schedule C. The trustee probably asked about it at the 341 meeting, too. Tell your attorney, who will tell the trustee. Don't spend it until your attorney tells you it's okay.

  3. Tax refund should have been listed on Sch.B as an asset. You need to ask your BK attorney. Under most circumstances, if the refund is high enough, you will have to turn it over to the trustee. Before you spend it, you need to find out. Your discharge can and will be cancelled due to this.

    Be sure to designate "best answer." If you live in Oregon, you may call me for more detailed advice, 503-650-9662. Please be aware that each answer on this website is based upon the facts, or lack thereof, provided in the question. To be sure you get complete and comprehensive answers, based upon the totality of your situation, contact a local attorney who specializes in the area of law that involves your legal problem. Diane L. Gruber has been practicing law in Oregon for 26 years, specializing in family law, bankruptcy, estate planning and probate. Note: Diane L. Gruber does not represent you until a written fee agreement has been signed by you and Diane L. Gruber, and the fee listed in the agreement has been paid.

  4. I agree with the attorney answers already provided. I would like to emphasis that you stated that you received your "discharge a month ago"; however you did not state whether or not your case was closed. Some debtors believe that the discharge order means that the case is closed- however, they are two separate events.

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