When Should I File For Bankruptcy – Before or After Taxes?

Are you contemplating filing a Walworth County bankruptcy this year? Have you thought about whether it is best to file bankruptcy before or after filing income taxes? This is something you definitely want to think about before you submit your Walworth County bankruptcy petition. Our Walworth County bankruptcy attorney can help you decide when to file.

File a Walworth County Chapter 7 Bankruptcy After Filing Income Taxes

Our Walworth County bankruptcy attorney suggests filing bankruptcy after filing your income taxes. In most cases, this is the best scenario. If you file a Walworth County bankruptcy before you file your 2015 income taxes, your tax refund will become property of the bankruptcy estate and distributed among your creditors. Unless your 2015 income tax refund is exempt, you will lose it.

How can you file a Walworth County Chapter 7 Bankruptcy and Keep Your Income Tax Refund?

There is a way. One thing our Walworth County bankruptcy attorney needs to make clear is that you cannot receive your income tax refund, spend it on frivolous items, and expect to keep it. If the bankruptcy trustee knows you received an income tax refund check, he or she will ask where it went. If you spent the check on luxury items, you may have to repay the amount spent to the bankruptcy trustee. This being said, your 2015 income tax refund must be spent on necessities. You will be allowed to keep your income tax refund if you file your income tax return before filing for bankruptcy and spend the refund on life necessities, such as: groceries, medical items, car repairs, etc.

You can are also allowed to pay your bankruptcy attorney fees with your income tax refund check without having to repay the money back to the bankruptcy trustee. For this reason, tax season is one of the best times to file for bankruptcy. You can easily afford your bankruptcy attorney fees by using your income tax refund. You won’t have to struggle by taking money out of your weekly checks.

File a Walworth County Chapter 13 Bankruptcy After Filing Income Taxes

When filing a Walworth County Chapter 13 bankruptcy, all income tax returns over the past four years must be filed before the meeting of creditors. In this situation, you have no choice but to file your 2015 income taxes before filing a Walworth County Chapter 13 bankruptcy.

File a Walworth County Bankruptcy After Filing Taxes

No matter which type of bankruptcy you file, Chapter 7 or Chapter 13, the bankruptcy trustee will ensure all required tax returns have been filed, this year and previous years. If you have any unfiled tax returns, the bankruptcy trustee may think you are hiding financial information. This will not only delay your bankruptcy process, but it will also cause the bankruptcy trustee to dig deeper into your case. Always be up front and honest will your Walworth County bankruptcy attorney and the bankruptcy trustee.

Schedule a Free Bankruptcy Consultation with our Walworth County Bankruptcy Attorney

If you are considering a bankruptcy this year and have questions, please contact our Walworth County bankruptcy attorney. Wynn at Law, LLC offers free, in-depth bankruptcy consultations. Our Walworth County bankruptcy attorney is here to listen, advice, and help you during your financial difficulties. You can reach our Walworth County bankruptcy attorney by phone at 262-725-0175 or by email via our website’s contact page. Wynn at Law, LLC has bankruptcy offices conveniently located in Salem, Delavan, Muskego, and Lake Geneva, Wisconsin.

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*The content and material on this web page is for informational purposes only and does not constitute legal advice.

Tags: bankruptcy, Taxes