Bankruptcy Law Questions? Ask a Bankruptcy Lawyer Now.
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In a Chapter 7, your bankruptcy estate (property, money, etc.) is established on the day that the bankruptcy petition is filed and consists of everything the debtor owns as of that day.
However, bankruptcy courts have held that a tax refund, or a portion of it, can be an asset, even though you may not receive it until well after the bankruptcy petition has been filed. Most courts divide the tax refund in proportion to the point in the tax year when the case is filed. For example, if you filed a bankruptcy petition on July 1, 2011, halfway through the year, 50% of your tax refund can become property of your bankruptcy estate. Obviously, if you file later in the year, that proportion will be greater.
The bankruptcy is completed after the discharge when the case is dismissed and closed. This usually takes a few months after the proof of claim deadline expires.
You can get married wherever you want as that has nothing to do with your Chapter 7 - the spouse's income has nothing to do with your bankruptcy. Also, you can sell your house whenever you want. You'll just have to get the court's permission to sell the asset if you do so during bankruptcy. If you wait until the bankruptcy is closed, you can sell it any time without permission from anyone.
when will i know if their going to take my income tax refund? Will i get the return and then they may take some or will i owe it to them? Shouldnt they have sent me a letter? Do they always take the return? Im just wondering if i should spend it if i get it or not? What are my chances that i will get it all and they dont?
Also, i thought i had to wait approximately 6 months after the closing discharge date to be able to get married or sell a house or anything with a change of income?!
You should receive the check, and you will have to report the receipt of this money to the trustee. As in the example, because you filed bankruptcy in July 2010, the trustee is likely to keep approximately 1/2 of the money because that is the proportionate amount of the refund for January - July 2010, which would have been part of your bankruptcy estate when you filed even though you hadn't yet received the refund. You should not spend it until you contact the trustee and resolve this issue.
Never heard of such a waiting period.....It makes no logical sense because when you file a Chapter 7, your estate is determined at that instant. You could win the lottery the day after you filed and the trustee or creditors cannot touch the money. Marriage has nothing to do with this because it would be an increase in income after the bankruptcy was filed - which is irrelevant. Also, you can sell anything you want, but if you're in bankruptcy, the trustee has to approve and has the right to the proceeds from the sale. However, once you're out of bankruptcy, you can sell whatever you please.
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