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Trustee taking large portion of tax refund for himself

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SunnyHeinz

Junior Member
Is this legal for a trustee to take a large portion of tax refund for himself when distributing a tax refund chapter 7
 
Is this legal for a trustee to take a large portion of tax refund for himself when distributing a tax refund chapter 7
Trustee gets a percentage of what he distributes to creditors. 25% of the 1st $5000. The percentage is reduced in increments thereafter down to 10%, then to 5% and then to 3% depending on the amount paid out. See 11 USC 326(a).

Des.
 

CatsGirl

Junior Member
When my lawyer went over my paperwork he said I could build my tax refund into my checks by claiming exemptions and not get any refund that way the trustee could not take my tax refund.

It would increase my payments some but at least I wouldn't have to submit my refund papers and if I happened to make a little more I could pocket it.
 

LdiJ

Senior Member
When my lawyer went over my paperwork he said I could build my tax refund into my checks by claiming exemptions and not get any refund that way the trustee could not take my tax refund.

It would increase my payments some but at least I wouldn't have to submit my refund papers and if I happened to make a little more I could pocket it.
That certainly can be done. However, its important to get help from a tax professional in order to determine what the right amount of exemptions should be. While you don't want to end up with a substantial refund you also don't want to end up with a large tax bill at the end of the year either.
 

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