If I file for Chapter 7 bankruptcy relief, can I keep my tax refund?

Yes. As a Lakewood Bankruptcy Lawyer, I frequently advise clients that the best way to keep a tax refund is to file your tax return, receive your tax refund, and then spend that refund on household necessities like rent, mortgage payments, car payments, groceries, or even your bankruptcy attorney fee. I’m busier during tax season than at any other time because tax refunds can be used to eliminate old debts through bankruptcy.

If its not possible to receive a tax refund prior to filing, another option is to use a Chapter 13 bankruptcy to avoid losing the refund. Chapter 13 is a reorganization of a consumer’s financial picture where you can keep all of the property you own while establishing a Plan to payback a portion of your debts. Your assets/budget determine which creditors get paid, and how much they get paid.

Still have more questions? If so, I’d please to get them answered during a free, initial bankruptcy consultation.