Q: I’m in a chapter 13 in Michigan. The tax refund portion of my case is silent. Will I get a refund if so how much?
My chapter 13 In Michigan tax refund portion is silent. Will I get a refund? If so how much am I an entitled to keep if this is silent. I really wouldn’t mind them keeping it if it paid my case off faster but this pandemic has put me out of work and I need all of my refund or pretty close to it. Is there anyway I can have my plan modified to add how much of my tax refund I can get back?
A:
Your Plan (whether before confirmation or thereafter) can be modified.
Your Plan commonly identifies the source of your funds, current and in the future, that will be used to make payments to the Plan, and routinely, that source is your current and future earnings.
It is at least arguable that "current earnings" would include your tax refund, even assuming that the refund is from earnings prior to the filing of the bankruptcy petition.
Yes, it would be best to clarify this issue by doing a modification of Plan, so that the Ch. 13 Trustee does not snare it.
A more serious threat looms, if your earnings have been interrupted, and you cannot pay future plan payments. You should certainly speak with your bankruptcy lawyer about that as well. If you default in your required payments to the Plan, and you cannot promptly cure the default, the Ch. 13 Trustee will file a Motion to dismiss or convert your case to a Ch. 7.
Trent Harris and Timothy Denison agree with this answer
A:
In the Eastern District of Michigan the standard plan requires you to turn over your refund. It is not a matter of the trustee grabbing it.
The good news is you can always amend your plan to account for change of circumstances. Show expenses for any un-budgeted event such as job loss and you will probably be able to keep your refund or some part of it.
You need to talk to your attorney (if you have one) about your various options.
Timothy Denison and Trent Harris agree with this answer
Justia Ask a Lawyer is a forum for consumers to get answers to basic legal questions. Any information sent through Justia Ask a Lawyer is not secure and is done so on a non-confidential basis only.
The use of this website to ask questions or receive answers does not create an attorney–client relationship between you and Justia, or between you and any attorney who receives your information or responds to your questions, nor is it intended to create such a relationship. Additionally, no responses on this forum constitute legal advice, which must be tailored to the specific circumstances of each case. You should not act upon information provided in Justia Ask a Lawyer without seeking professional counsel from an attorney admitted or authorized to practice in your jurisdiction. Justia assumes no responsibility to any person who relies on information contained on or received through this site and disclaims all liability in respect to such information.
Justia cannot guarantee that the information on this website (including any legal information provided by an attorney through this service) is accurate, complete, or up-to-date. While we intend to make every attempt to keep the information on this site current, the owners of and contributors to this site make no claims, promises or guarantees about the accuracy, completeness or adequacy of the information contained in or linked to from this site.
