Posted on: 19th Feb, 2010 12:25 pm
If I file for a Chapter 7, in 2010 will I be allowed my refund for this year 2010 in 2011?
Hi tanyaneil,
While you are in bankrupty, the entire or a part of the tax refund can be considered as your asset and your bankruptcy trustee can use it to pay off your creditors. Thus, your tax refund for the year 2010 can be taken by the trustee. However, if you receive the tax refund after you have been discharged from bankruptcy, the trustee cannot take it from you to pay your creditors.
While you are in bankrupty, the entire or a part of the tax refund can be considered as your asset and your bankruptcy trustee can use it to pay off your creditors. Thus, your tax refund for the year 2010 can be taken by the trustee. However, if you receive the tax refund after you have been discharged from bankruptcy, the trustee cannot take it from you to pay your creditors.