After bankruptcy ends...

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low income senior

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After bankruptcy ends...
« on: March 20, 2014, 03:54:00 AM »
I declared my bankruptcy in March 2013 and I finished my bankruptcy 9 mths later on December 2013, and now I find that not all debts are extinguished after all, even after bankruptcy ends, because my bankruptcy trustees can and will still take my 2013 income tax refund-just like they took my income tax refund for 2012 (for the year before I declared bankruptcy).  So who gets this refund money if all debts are extinguished?  I have a huge dental expense coming up of  approx. $10,000 and I would like to apply my small income tax refund for 2013 towards that expense.  The most the income tax refund might be would be is less than $2,000, more likely about $1,100 at most.  So this means that despite having no money to pay any debtors last year and this year either - otherwise I would not have declared bankruptcy - they can still take more money from me even though it is for an emergency dental expense.  I think some consideration should be given for emergency expenses to people who have finished their bankruptcy, as it is hardly surplus income or anything like that, especially since in my case I am a low income senior.  Has anyone just after bankruptcy ever been allowed to use their income tax refund for any emergency dental expense?  If so, please reply - thanks - low income senior in B.C.

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JEC

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Re: After bankruptcy ends...
« Reply #1 on: March 20, 2014, 08:46:31 PM »
Ask your bankruptcy trustee about how income tax refunds get applied before and after bankruptcy. He/She would be the person who would know the best.  It should have been explained to you during your process.

JEC

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low income senior

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Re: After bankruptcy ends...
« Reply #2 on: March 21, 2014, 01:34:22 PM »
Thank you for your reply.  My bankruptcy trustees did advise me of what they would do about my income tax refunds during my signing of the bankruptcy papers but what they did not explain is what happens to them if you have any emergencies during or after the bankruptcy ends.  The two links below show some information I found on the internet about income tax refunds and I thought maybe one or both of them might apply to my bankruptcy case.  Please look at them.  Please look at these two links:
nolocomlegalencyclopediacanikeepmytaxrefundchapter13bankruptcy
bankruptcycanadacabankruptcy201207questions3
(I had to remove all punctuation for the links so I could include them in this post.)
The Nolo link talked about dental expenses and I had hoped that one of them might apply to my situation and so I thought I would explore some options in the vain hope that maybe there would be an option for me after all because to me it is an emergency.
low income senior (in B.C.)

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TreeFrog

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Re: After bankruptcy ends...
« Reply #3 on: March 21, 2014, 08:20:07 PM »
Hi,

Sorry you are having a dental emergency. I know how miserable that can be.

Your first link is about Chapter 13 bankruptcy, which is the U.S.A. form, so its rules would not apply here in Canada.

I was able to access your second link, where the trustee on this site explained about how tax refunds are handled in bankruptcy - basically the same as you are experiencing. The person asks about Child Tax Refund, which is apparently retained by the bankrupt person - but this scenario isn't necessarily related to rules regarding the general Income Tax Refund.

I'm with JEC, in that you'll need to ask your trustee for specific info. Unfortunately, I've never heard of exceptions of this kind for emergencies ... but your trustee will know for sure.

Best wishes,
~Wendy

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low income senior

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Re: After bankruptcy ends...
« Reply #4 on: March 22, 2014, 12:50:10 PM »
Hi,

Thank you again for your response.  I was hoping you would know something about emergencies as they do arise whether we want them or not and there is literally nothing around that I can find about that.

About that second link I mention, that you mention too, I reread the entire article, it does not say one word about Child Tax Refund so not sure what you were looking at.  It actually says lots but more importantly, it says this about the tax refund:
"Tax Refunds and Bankruptcy in Canada
Your trustee is incorrect.  
In simple terms, you lose your tax refund for the calendar year that you declared bankruptcy in Canada.  Providing your tax information to your trustee for the year of bankruptcy is one of the duties you must perform to receive your discharge from bankruptcy."
My trustees told me many times that they were going to take both tax refunds from me even if they have to get a Court Order to do it.  Also, they have been very, very aggressive against me with everything, even going so far as to saying I lied about the OAS recovery tax I paid when, in fact, they had the OAS confirmation e-mail in their hands long before I started my bankruptcy.  I still have that email confirmation in my hands as well so I can refer to it anytime.  In the end, I was correct about OAS as well, and after submitting papers for a substantially lower income in both 2012 and 2013, OAS ended up refunding me $615.00 which my trustees told me I would never get.  The Trustees don't always look at or completely look through the tax papers you give them, even going so far as to forgetting to claim a lot of tax papers before filing the income tax refund for you and then blaming you for them having to do an amendment income tax to CRA. Remember, the trustees don't work for you, they work for your creditors so you have to remember to keep a copy of every single thing you send or give them and document every phone calls & details as well.
If anyone ever received help with an emergency during or shortly after bankruptcy, I would be interested in that conversation or links so same - thanks - low income senior (in B.C.)
« Last Edit: April 03, 2014, 07:52:49 AM by admin »

 

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