The deadline for filing taxes is just around the corner. People across the country are filing their taxes and hoping for a tax refund, rather than having to pay more taxes. This can be a time of anticipation if you are expecting a tax refund. Many times, a tax refund can provide helpful funds at a time when you really need them. However, it is possible to have these funds taken before you even lay hands on them due to a bank setoff.
What is a Bank Setoff?
Banks and other financial institutions such as credit unions or savings and loan institutions are permitted to setoff your account. A setoff occurs when the bank immediately takes money from one of your deposit accounts (this could be your checking or savings account) and uses it to offset, or cover, a missed payment or outstanding debt you owe to them. These debts could come from a loan the financial institution gave you like a car loan or mortgage or a credit card issued by that institution. What this means is that money you thought you had or thought would be deposited could disappear in an instant.
How Does This Affect My Tax Refund?
Because the bank can take money from your deposit accounts to offset other debts, it is possible that your tax refund is not safe. When your tax refund hits your account, this money can immediately be taken by the bank to satisfy your other debts if you are behind on payments. Once the bank has setoff those funds and put them towards your other debts, you cannot get those funds back to use them for other needs. This can be particularly challenging if you are experiencing financial difficulties and plan to use your tax refund to take care of yourself and your family. It is best to take action beforehand so you can try to stop the setoff from happening.
Get Guidance from An Experienced Atlanta Bankruptcy Lawyer
If you are facing a difficult financial situation, you should sit down with an experienced Bankruptcy attorney at the Ballard Law Group. We can talk about your specific situation and see what the best move is for your financial future. Losing your tax refund due to a bank setoff can be especially frustrating and may put you in a place where you are overwhelmed financially—it is important to know that you have options, including an Atlanta bankruptcy to help get you back on track toward a secure financial future. If you think it is likely that your tax refund will be used to satisfy other debts at your bank, filing for bankruptcy beforehand could protect your money, at least initially, as any collection actions against you must immediately stop once you file.
The skilled attorneys at the Ballard Law Group have years of experience helping clients facing financial troubles. We can evaluate your individual situation and advise you as to whether a bankruptcy would be in your best interests. Call us today at 404-220-9906 to schedule your free initial consultation at either our Atlanta or Lawrenceville office.