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Re: Creditors May Not Sieze IRAs
Old 04-06-2005, 04:55 AM   #21
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Re: Creditors May Not Sieze IRAs


Do you think that the reasoning in Rousey v. Jacobs extends to Roth IRA's? I would think that it might not since Roths can be withdrawn penalty free after 5 years. The decision appears to put a lot of weight on the 10% penalty.


Good catch, Rapoole. You are right that the court put a lot of weight on the 10% penalty. I am sure it will be litigated at some point. I could see a court finding that the contributions which can be withdrawn at any time without penalty are not exempt, but possibly find that the earnings are exempt.

I do know that some states treat Roth IRAs in their exemption statutes different from how traditional IRAs are treated.

We will also have to see what happens with the new bankruptcy bill. I only have casually followed the proposals and changes so I am not up on exactly what it currently says. I know there has been talk off and on about a million dollar IRA exemption


No more lawyer stuff, no more political stuff, so no more CYA

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