Legal Question in Bankruptcy in Illinois

Based on the facts described in your inquiry, yes, the IRS can attach any tax refund to satisfy certain liabilities, including the tax liability of your wife. Your tax refund is not considered to be "savings" by the IRS. In fact, taxpayers are advised to not use the tax system as a savings account. It pays no interest and is subject to IRS attachment. Your wife, as joint filer, is entitled to a joint share of the refund. You can protest the attachment of the refund with the IRS; of course, you are advised to limit or minimize any withholding or payment of estimated taxes in the future to cover only your estimated tax liability. Also, it is not clear why the bankruptcy resulted in a tax liability; we assume the tax liability was not discharged in the bankruptcy so it has continued.