Retirement Plans and Chapter 7

Orange County Chapter 7 Bankruptcy Lawyer

Many individuals that are interested in Chapter 7 bankruptcy understandably have questions that they would like to have answered before proceeding. The best thing to do in all cases is review your particular situation with a highly qualified and experienced Orange County bankruptcy attorney at your earliest convenience.

The good news is that those individuals that file for bankruptcy will get to keep their retirement and pension plan funds. There are some exceptions to that rule but generally, anyone filing for bankruptcy need not worry about their retirement accounts. Anyone considering using a retirement fund for debt purposes should speak with a highly qualified and experienced attorney before doing so. There are many other options available to those faced with debt. In addition, those considering bankruptcy may not realize that their retirement accounts are exempt. This means that anyone filing for bankruptcy can not only free themselves from debt, but additionally they can keep their retirement funds.

Bankruptcy Lawyer in Orange County

In 2005, congress changed the bankruptcy laws and made it so that more retirement assets are protected during bankruptcy proceedings. There are a few exceptions, but in most cases, the exemption amounts are unlimited, meaning the entire amount of the account is protected. The exemption status includes:

• 401(k) s
• 401(b) s
• Defined-benefit plans
• Keoghs
• IRAs
• Profit-sharing plans
• Money purchase plans

There is a limit, however, on IRAs. To fully understand the exemption limit on one's personal IRA, it is advised that one speak with an attorney. Generally, an IRA will have an exemption limit of about $1,000,000.

In addition to protecting retirement plans, a bankruptcy attorney can assist those that have borrowed money from retirement accounts. When an individual decides to borrow money from a retirement plan, he or she will eventually have to pay it back. Depending on the type of bankruptcy that has been filed, the retirement account loan may be discharged.

Contact an Orange County bankruptcy attorney from the firm to discuss how Chapter 7 could impact your retirement plan.