November 22nd, 2012 by Questions
I had filed bankruptcy in feb 2009, discharged in dec 2009, i had a T1 adjustment done for the years 2004-2008 for our son’s disability credit.
CRA sent the full reassessed amount to the trustee, i called them and they said they would give me half of the total if i signed it over, or i could dispute which means that we could get it all or nothing at all, is this a proper route and what is the best decision?
Posted from: Ontario
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November 22, 2012 at 7:43 am, A licensed trustee said:
The Courts in Ontario have decided both ways in these cases – sometimes they let the bankrupt keep the money as it was designed to benefit the child, sometimes they seize all of the money for the benefit of your creditors as the law says all tax refunds for the year you file and all previous years belong to your creditors.
Think of it this way – if you had recieved the refunds in each of the years (instead of now) you may not have used as much credit or you may have used the refunds to pay down your debt. Your trustee is suggesting a reasonable compromise that might get them in trouble – a credit might argue they should seize it all.
So, you have the right to fight it – just be prepared to lose. Sometimes 50% of something is better than 100% of nothing…