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Ask cfortunato Your Own Question
cfortunato, Attorney
Category: Bankruptcy Law
Satisfied Customers: 8023
Experience:  Bankruptcy professor.
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I am married and I will file for bankruptcy with my spouse.

Customer Question

I am married and I will file for bankruptcy with my spouse. We always file a joint tax return. Can I also claim to keep the part of the tax refund even though I am not employed?

I read about the following case but they file bankruptcy independently:
If a consumer who is married and regularly files a joint tax return files for bankruptcy independently of his or her spouse, the bankruptcy court is only entitled to half of any tax refund the couple receives. The remaining half can be kept by the non-filing spouse.

If, however, the spouse who is filing for bankruptcy is not currently employed and has not been employed for the duration of the fiscal year, the tax return can be kept in its entirety by the working spouse since the working spouse is the only one who has contributed to the refund. See Case 08-46189-DML.
Submitted: 5 years ago.
Category: Bankruptcy Law
Expert:  cfortunato replied 5 years ago.

Hi JACustomer,

In the case In Re: Renee Marie Martin #08-46189-DML, the court determined that the income tax refund belonged to the spouse who was working. Since the non-working spouse is the one who filed a Bankruptcy, the Bankruptcy court was not entitled to the refund, which belonged to the working, non-filing spouse.

If a working spouse does file a Bankruptcy, the Bankruptcy court is entitled to the refund, per Bankruptcy Stat. 541(a)(2)(A). It does not matter that the non-working spouse will also be filing.

In other words, if you and your spouse file a Bankruptcy, the court will be entitled to have the entire refund.

A better way to keep an income tax refund is to file a Bankruptcy after the refund is received and spent.


I think this is what you wanted to know. If not, please let me know.

Thank you!



Customer: replied 5 years ago.
Thank you for the answer. In our case in Maryland, there is $12000 exemption limit to each of us. Therefore my spouse can claim some amount from the tax refund. So I am wondering whether I can also claim some portion from the tax refund.
Expert:  cfortunato replied 5 years ago.
It sounds like you want to know if you can apply your exemption to your husband's refund. I do not know the answer, so I will opt out of this question so that someone else can help you further.
Customer: replied 5 years ago.
Thank you. Yes, that is my question. What should I do now in order to get the answer from someone else?
Expert:  cfortunato replied 5 years ago.
The question is available for all other Bankruptcy Law experts to answer. You do not need to do anything.

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