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4 important tax tips for bankruptcy filers

| Aug 20, 2018 | Chapter 7 Bankruptcy

If you, like so many others across Florida, are thinking about filing for bankruptcy protection this year, you may have questions about how it will affect your taxes, and whether you will have to take any special steps when filing them. At the office of Kingcade Garcia McMaken, we have a firm understanding of the important tax implications that come with filing for bankruptcy, and we have helped many bankruptcy filers make sure they are taking all the rights steps and appropriately covering their bases.

According to TurboTax, one thing you ought to consider when it comes to filing for bankruptcy and filing your taxes is when, exactly, to begin your bankruptcy case. Unless you anticipate receiving a large tax refund, it may be wise for you to file your taxes before filing for bankruptcy.

If, however, you already filed your taxes and do not want to wait until the following year to begin a bankruptcy case, you will want to make sure that you have all your tax records readily available. It is also important that you can clearly demonstrate how you utilized any money you got back after filing your taxes before moving forward with your bankruptcy filing.

If you have already received your tax refund for the year, but you are still thinking about filing for bankruptcy, avoid paying bills with the tax refund. Why? Doing so can throw a wrench in the works and cause unnecessary delay in your bankruptcy case. Finally, and while this may sound obvious, make sure you file your taxes by the deadline to avoid accruing unnecessary fees that can set you back even further. You can find more about bankruptcy on our webpage.