How Does Filing Missouri Or Illinois Bankruptcy Affect My Tax Refund?

Really, only a qualified St Louis Bankruptcy attorney can tell you the answer to that question

. Why? Every situation is different and there are different rules that typically apply. However, here are the general rules regarding tax refunds and your Missouri or Illinois bankruptcy.

Your refund might be used by Uncle Sam to pay and tax debt you have before you even get a chance to see it. They may even be able to take it even if you aren't filing bankruptcy. In a Chapter 13 in Missouri, however, there is a local rule that allows debtors to keep a portion, if not all, of your tax refund. Even better, for the time being in Illinois, you can keep your refund.

Putting off getting protection from foreclosure, credit card debt help, and relief from your creditors just to save your tax refund may not be the best idea either. If you owe money for child support, student loans, or other government loans, the government can still take your refund to apply to these debts.

Even if Uncle Sam isn't a creditor of yours, others can still get after your cash. Are your creditors levying your bank accounts? Creditors can get after that extra cash you have in the bank. Even if you don't hire a St Louis bankruptcy attorney to take care of your debt, you may not want to have your tax refund direct deposited. If your creditors are after your checking accounts, it may be best to just get your refund the old fashioned waythrough a check in the mail that you can cash yourself.

It may be time to think of your tax refund a little differently. Shouldn't you be using your tax refund to pay on your debts anyway? All the rules associated with Chapter 7 and Chapter 13 bankruptcy are designed to get you out of debt, not to keep you in it. It would be great to use that tax refund on a long-awaited shopping excursion but it may be best, if you are in crushing amounts of debt, to use your refund for your debts.

Keep in mind, bankruptcy holds the power to change your life--and the life of your family. With the help of a bankruptcy attorney, you can finally build the life you want to have for you and your family. Bankruptcy may not be the right move for you, but the only way to truly know is to educate yourself on your options.

by: Jim Brown

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