Is My 401k Included in the Bankruptcy Estate?
Posted By
Majed on Apr 1, 2011 7:02am PDT
Probably not. This is an issue that has been litigated before the Supreme Court, which ruled that employee pension plans may not be part of the bankruptcy estate. Additionally, the Bankruptcy Code states that certain retirement accounts (including the standard 401k) are exempt from collection by creditors. Most individuals filing bankruptcy would be covered under the code. However, if your retirement account is very large or is in a regular bank account and not earmarked as retirement, it may not be automatically exempt.
Debtors looking for a fresh financial start would be remiss in not protecting their nest egg. Our experienced attorneys at the Fears | Nachawati Law Firm have seen all sorts of cases, even ones like yours. Contact our firm today to find out your rights to retirement in bankruptcy.