Are My Retirement Accounts Protected in Bankruptcy in New Jersey?
By Brenner Spiller & Archer, LLP | February 21, 2022
Filing for bankruptcy helps people who cannot afford to pay their creditors. Bankruptcy can put a pause on everyone trying to get your money and give you a chance to catch your breath and figure out how to take care of your debts.
But many people who are considering filing for bankruptcy have retirement accounts, own a home, or owe payments on a vehicle loan. You might be worried that filing for Bankruptcy could cause you to lose your house, car, retirement savings, etc… Rest assured that the Bankruptcy laws were set up to allow certain property to be protected from the Bankruptcy so that you don’t leave Bankruptcy with nothing.
Our Bankruptcy attorneys at Brenner Spiller & Archer, LLP, can answer your questions regarding which property you can be protected
Contact our office today so we can start reviewing your case.
Common Questions About Bankruptcy
For many people, bankruptcy offers an opportunity to escape from serious financial difficulties. The reasons for filing bankruptcy vary from person to person. It could be mortgage foreclosure or property taxes. In some cases, crippling medical bills that overwhelm the debtor can lead them to consider filing for bankruptcy. Alternatively, someone with a mountain of credit card debt might file for bankruptcy to restart the process of building their credit. At Brenner Spiller & Archer, LLP, we understand that bankruptcy laws can be quite difficult to understand. We are here to help review your case and answer any questions you have about the process.
What Debts Can I Discharge in Bankruptcy?
If you are at all familiar with bankruptcy, you might know that bankruptcy law does not allow you to discharge certain debts. By filing for Chapter 7 bankruptcy, you can discharge most types of unsecured debt, including credit card debt and medical debt. Debts that are not discharged in bankruptcy include:
- Certain tax obligations;
- Student loans (possible to discharge, but not automatically discharged);
- Child support or alimony;
- Debt incurred by fraud;
- Debt incurred by the debtor’s willful and malicious injury to another; and
- Fines or penalties due to a governmental unit.
Individuals, married couples, corporations, and partnerships can file for Chapter 7 bankruptcy. If you have questions about whether your debt is dischargeable in bankruptcy proceedings, contact Brenner Spiller & Archer today.
Are Retirement Accounts Protected in Bankruptcy?
Before moving to file, many people want to know if their Individual Retirement Account (IRA) is protected in bankruptcy. The federal government recognizes that people put in years of hard work to build up their retirement accounts. Additionally, the government realizes that if they take away your retirement account, it could easily result in your having to live off of government welfare programs later in life. As a result, the Bankruptcy Code has a 401K bankruptcy exemption that allows you to keep your retirement account.
However, if you inherited a retirement account after the death of its original owner, that account is not exempt from bankruptcy proceedings. Additionally, if you withdraw the funds from your retirement account and put them into a checking or savings account, the funds are no longer protected against bankruptcy.
If you have more questions about whether your IRA is protected in bankruptcy, contact Brenner Spiller & Archer, LLP today.
Contact Our New Jersey Bankruptcy Lawyers at Brenner Spiller & Archer, LLP
We know that the decision to file bankruptcy is never an easy one. Our bankruptcy attorneys represent clients throughout Central and South New Jersey in their bankruptcy proceedings. We have helped hundreds of clients achieve a fresh financial start through this process. Whether you are concerned about stopping foreclosure on your home or avoiding the repossession of your vehicle, our team is here to walk you through the process. And if you decide that bankruptcy is not the right choice for you, we can help you consider other options that can alleviate your financial burden.
At Brenner Spiller & Archer, LLP, we have over 40 years of experience assisting our clients with bankruptcy matters. Our experience in the bankruptcy industry has given us a wide and deep knowledge base from which to pull when assessing your specific situation and needs. We also know of the strategies the opposing side will use against you to try to make this process harder, and we know how to protect you in the face of these tactics. In short, we have the expertise necessary to represent you effectively and efficiently in your bankruptcy case. Contact our office today to schedule your free consultation. We look forward to serving you!