Your Retirement Account Money Is Safe In Bankruptcy

Are you considering bankruptcy but fear that you will lose your retirement account money?  Don’t be!  You can protect (“exempt” in bankruptcy terms) all funds in most tax-exempt retirement accounts up to $1,283,025.  That’s right: you can have over a million dollars in a tax-exempt retirement account and still protect it from creditors in bankruptcy.  In chapter 7 bankruptcy, that means that the trustee can’t take this money to pay your debts.  In chapter 13 bankruptcy, it means that the money in your retirement account will not be counted as money that you have to pay your general unsecured creditors (credit cards, doctor & medical bills, personal loans, etc.).

Be aware that this money must be in a tax-exempt retirement account like a 401(k) or an IRA in order to be protected in bankruptcy.  Merely putting money in a savings account and saying that it’s for retirement would not allow this money to be protected in bankruptcy, even if you never touch the money until you retire.

If you have serious debt problems, contact a bankruptcy attorney today.  We can analyze whether your retirement money would be protected in bankruptcy, and show you how to make it so if it is not.