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Do I have to Declare my Tax Return in a Bankruptcy?

If you are concerned about whether you have to declare your tax return in your bankruptcy action, then you are in financial trouble. Any extra money coming in can certainly be put to good use, besides going to your creditors. You may be thinking that because your tax return is extra and not ongoing income that you don’t have to declare it. In both forms of bankruptcy which is the chapter 13 and chapter 7 you do have to reveal that you are going to receive or have received a tax return. 

Declaring All Information

In fact, you may be asked about this directly at your bankruptcy meeting if you have not declared it. If you have not declared your tax return, and you have already used it, then you could be made to return it to the bankruptcy estate. It is extremely important that you fully understand what role your tax refund is going to play in the outcome of your bankruptcy.

In both cases there are protective actions that can be taken so that this extra money doesn’t become part of the bankruptcy. There are strict rules and regulations concerning this, and if you are not aware of them, then it will be difficult to use them in your favor. No matter which bankruptcy action you are going under or whether there is a tax refund issue or not, it is wise to use the services of an experienced Louisville bankruptcy attorney. Once you have made your decision to file for this debt resolution, your next step should be in getting the right help.

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