Tax Refunds in Minneapolis, Minnesota
When filing bankruptcy, you must list all your assets. This includes those you might not have yet. Even if you haven’t filed your taxes yet or haven’t received your refunds, you must still list your tax refund as an item in your bankruptcy case. You will estimate your tax refunds based on when you filed. If your case was filed on December 12th, the share of your tax refund that you were entitled to on the date of filing would be approximately 95%. In bankruptcy, you can protect your assets with exemptions. In Minnesota, you have the option to choose between federal or state exemptions. The results of your exemptions are treated differently depending on whether you file a case under chapter 7 or chapter 13. A chapter 7 bankruptcy is a liquidation case. If you can’t exempt your assets from bankruptcy, you’ll need to either turn them over to a bankruptcy estate or purchase them back in order to keep them. This means that liquid assets, such as tax refunds, will be turned over. If you can exempt all or part of your tax refunds, you will keep the amount you have been allowed to keep. A chapter 13 bankruptcy is a restructuring your debt. In a Chapter 13 case, the standard language for a bankruptcy case states that you will be able to keep $1200 of your tax refunds if you are a single filer or $2,000 if you are a joint filer. Your attorney may be in a position to adjust these figures depending on your specific situation. You would have to pay your creditors any amount above the threshold you keep. If you have any questions about your taxes, speak to your bankruptcy attorney.
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