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Good day sir,

I am currently in bankruptcy and have been told by the paralegal handling the case that I must repay the tax refund I received for last year. the refund was for 3900. All except 450 was garnished as it was owed to the government. Now the trustee wants to pay back the refund in the monthly payments.

I do not understand why I would have to pay back money that I did not receive and was used to pay debt owed. I feel I should only pay back the 450 that was left over. Also this was received prior to filing. I am located in Florida.

Thanks in advance.

This is what happens when you get "legal" advice from paralegals;  in this instance you have received incredibly bad advice but then these people have no legal training so that's understandable, and actually not all that unusual.

If you were not able to exempt the $450 you received, the trustee may have a claim to that, but the rest, I don't see how. I'm not sure what the exemption laws are in Florida but you might want to see if you have what's called a "wild card" available to exempt the $450.  If so, make sure it's exempt then the trustee can pound salt.

As for the rest, it went, involuntarily,  to pay a preexisting tax debt and they had a secured lien on your refund.  Just tell the trustee "no" on anything above $450 and make him or her get a court order requiring you to pay money you never received.  That's just nuts.  If you can exempt the $450, then pay the trustee zero.


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Consumer bankruptcy questions invited. I've been filing Chapter 7, 11 and 13 cases since 1985 in Calif and Arizona. I do NOT do homework questions. Let me know what state you're located in when you write. My bankruptcy practice is limited to California and Arizona but inquiries from other states are welcome. Your local jurisdiction determines exemptions. Find more background information at our website, Individual Chapter 11 and small business chapter 11 questions invited. We can also advise on the creditor's side if for example you have a fraud case, money judgment etc against someone who has filed (or is threatening) bankruptcy. We have filed and defended numerous adversary complaints in bankruptcy court and opposed trustees' demands for turnover of assets from time to time.


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