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Retirement Savings Plans Safe In Bankruptcy
Cathleen Cooper Moran

If you file bankruptcy, can they take your 401K? Thanks.

-- Calli

A.

Retirement savings are beyond the reach of creditors and the trustee in bankruptcy. Any plan qualified under ERISA, such as an employer pension plan or 401(k), is not "property of the estate". It cannot be used by the trustee to pay creditors.

IRA accounts now are protected by a bankruptcy exemption, available in every state, up to 1 million dollars.

Good reasons to fully fund IRA's and 401(k) plans: you will need the money to retire and it's safe from creditors in the meantime.

-- Cathleen Cooper Moran

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Martindale-Hubbell® Lawyers.comSM is the most complete, trusted source for identifying qualified legal counsel.

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