Legal Question in Bankruptcy in Nebraska
seizure of my tax refund
We are a low income family of less than $10,000 per year for 4. We were expecting an EIC refund of $3000, but it was held by some creditors.
I was never informed that my refund had a lein against it; if I declare bankruptcy, can these tax leins be taken off so that I can get my next years refund?
Also, I was counting on that refund to purchase a car for my family transportation; can I get it back by claiming that the seizure is an undue financial burden on my family?
2 Answers from Attorneys
Re: seizure of my tax refund
You also asked in your question about whether or not the lien can be removed through bankruptcy, that is dependent on the underlying debt. If it is for taxes that were timely filed and are more than 3 years old, then those liens can be removed.
Liens to enable collection of child support, alimony or student loans CANNOT be removed because those debts are not dischargeable.
There are some exceptions to the information above, but would need to know your circumstances to tell you if they apply. See an attorney in your area for more information about whether and how much bankruptcy can help you and your family. Good Luck!
Talana Sayre
(402)689-9164
Re: seizure of my tax refund
In Nebraska there is NO specific credit for EIC or tax refunds generally. Therefore, the ONLY way to keep all or a portion of your tax refund is for you to use your standard exemptions, i.e. personal property -- which is subject to a limit of $2,500 individual and $5,000 joint. Many states allow for an unlimited exemption as it relates to tax refunds and EIC but NOT in Nebraska. The "undue burden" argument is also not valid under NE bankruptcy law. Good luck.
Kyle L. Doviken, Attorney
www.dovikenlaw.com
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