It is well known in Bankruptcy circles that in general IRAs are exempt from the Bankruptcy Estate. It is less known but still significant that there are exceptions to this general rule. Recently the sixth circuit decided a case that marginally scales back the reach of these exception. This is very good news for debtors in Bankruptcy.
You can read the decision here
In this case, James Daley had a medium sized IRA with Merrill Lynch. When he opened it he signed an agreement that pledged the funds against possible future indebtedness. The BK court and the District Court said that this transaction exposed the IRA to the reach of the BK trustee. Fortunately the Circuit reversed.
Check out my book on Amazon or one of the many links on this site.
You can read the decision here
In this case, James Daley had a medium sized IRA with Merrill Lynch. When he opened it he signed an agreement that pledged the funds against possible future indebtedness. The BK court and the District Court said that this transaction exposed the IRA to the reach of the BK trustee. Fortunately the Circuit reversed.
Check out my book on Amazon or one of the many links on this site.
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