Here is an example:
Let’s say a single individual files bankruptcy, and on the date of the bankruptcy filing that person is entitled to get a $3,000 tax refund, but has not received it yet. That person could exempt $2,500 of that refund under their exemption, but would have to turn over $500 to the Trustee. The alternative is for the individual to wait to file the bankruptcy until after they have received the tax refunds and have less than $2,500 of it left in their bank account.
Whatever you do, make sure you don’t pay family members more than $500 of the refund, because any payments to family members of over $500 within a year of filing bankruptcy would be considered a preference payment. Additionally, you would not want to pay ordinary creditors more than $500 within 90 days of filing bankruptcy, since this too would be a preference payment.