Income Tax Turnover Order

The Income Tax Turnover Order is an automatic order issued by the court when every Bankruptcy Petition is filed and remains in effect for the entire period during which a case is open.

It requires that a debtor do 3 things:

1. That a debtor file their State and Federal tax returns in a timely fashion (so either by April 15th or if an extension is filed, by October 15th).

2. That the debtor turn over to the trustee all tax returns that the debtor files for any tax year during which the bankruptcy case was open. This can span several tax years. I advise chapter 7 debtors that even if their case is currently closed, if it was open during the tax year, then forward a copy of the tax returns to the trustee.

3. That the debtor turned over to the trustee all tax refunds the debtor possessed on the petition date, or received while the case is open.

In a chapter 7 case, the Income Tax Turnover Order also requires that a chapter 7 debtor file all pre-petition tax returns that were required to have been filed but were not filed.

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