I was curious about IRA bankruptcy protection. This web page suggests that all IRAs are now protected up to $1M (by the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 ) and confirms all 401k, 403b, 457 and pension funds are protected under ERISA. It has a state-by-state listing of what is protected ("exempt") above that limit (scroll down a while). I assume the $1M is in aggregate if you have multiple tIRA and Roth accounts:
Protect Retirement Assets
My state exempts tIRAs but NOT Roths (but I can only dream of having $1M in my IRAs).
It's probably important to read the entire article if you have worries in this area. As an example
"As an example, Mark Smith is a small business owner who has $500,000 invested in a SEP IRA established by his company. Under his state’s law, assets held in an IRA generally are exempted from any creditor claims. Mark is successfully sued for $300,000 of damages in state court and is not filing for federal bankruptcy protection.
This matter is outside of federal bankruptcy law, and the new bankruptcy protections therefore do not apply. Because Mark’s money is in a SEP IRA, it constitutes an ERISA pension plan, preempting any state law directly protecting it, and it would not qualify for the antialienation protections usually afforded ERISA plans. The judgment creditor therefore may successfully attach Mark’s IRA.
If Mark transferred the money in his SEP IRA to a rollover IRA, it no longer would qualify as an ERISA pension plan. Thus it would be protected from creditor claims up to $1 million either inside a bankruptcy proceeding or possibly to an unlimited extent outside of bankruptcy under applicable state law."
If it's TX, then I like it but its population is expanding by leaps and bounds so it's not too attractive for me (same this is happening in my little city) unless a big portion of it deceases by the time I retire.
