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Should we file our tax return before we file for Bankruptcy?

Las Vegas, NV |

My husband lost his job of many years right before Christmas and now we are looking into filing for bankruptcy. However, we are going to need our tax return to be able to pay for a bankruptcy lawyer. We are trying to keep up our house payments, utilities and one car payment but are about to miss our first credit card payment ever.

Attorney Answers 3


The conventional wisdom is to get the return prepared so you can see what your refund will be. Nevada does provide an exemption for a refund as a result of EIC, and there is also a $2,000 wildcard exemption that could be applied to your tax refund.

But as you have indicated you need the refund money to pay your lawyer for the bankruptcy, you will need to have the money in your pocket to do this. The sooner you file the return, the sooner you will have the necessary cash.

Hope this perspective helps!

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Any time my clients are going to get a sizeable tax refund, I advise them to wait until they receive the refund before filing their bankruptcy. This allows them to pay down on a car, get some needed dental work done, or basically use the money for necessities, payment on secured debt, but not gambling it away, before filing bankruptcy.
If you need it to pay for your bankruptcy attorney, then you have basically answered your question already.
You should still have a consultation with a bankruptcy attorney, most do it for free, so you can prepare.

Best Regards,
William Devine, II
Las Vegas & Henderson, NV Bankruptcy Attorney

I am an attorney, just not your attorney (yet). Any answers here are to be deemed informational unless and until you retain me as your attorney for actual legal services and legal advice. I offer free in-person consultations. If you like my answer, please hit the thumbs up button.

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Prepare your return. Have it reviewed by your bankruptcy attorney to determine whether or not you can retain the refund that you will have coming if you file the bankruptcy before you receive your refund. A local, experienced bankruptcy attorney will be able to let you know the dollar amount that qualifies in order to be retained.

The attorney will also be able to advise you about retaining your home and one car.

Bankruptcy is not rocket science but our U.S. Congress has made it complicated and handling on your own is not the best thing to do.

If you need your refund to pay lawyers fees, then by all means, file your return before you file bankruptcy.

Please be advised that the advice to you herein does NOT establish an attorney client relationship and that our firm does NOT represent you in any 7 Bankruptcy matter.

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