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  1. #1
    Join Date
    Jun 2007

    Default IRA Deposits Made Shortly Before Filing Bankruptcy

    According to the new bankruptcy law, IRA accounts are exempt assets, but it seems obvious that if you max out your credit cards, for example, and then deposit the money into an IRA, that money isn't exempt. So, there should be some rule that says something like: "If the payments to the IRA occurred within 90 days...." or maybe "If the funds can be shown to be a result of fraud..." you get the point. My question is, if I have some savings that I have earned independent of any debts that I have accrued, can I legitimately deposit this savings into an IRA and then declare bankruptcy?

  2. #2
    Join Date
    Sep 2005
    Behind a Desk

    Default Re: IRA Deposits Made Shortly Before Filing Bankruptcy

    You can try. You may have to produce the money despite your effort to hide it from your creditors, and that could cost you penalties plus (assuming it's a regular IRA as opposed to a Roth IRA) trigger taxes.

  3. #3
    Join Date
    Apr 2007
    Il.(near StL,Mo.)

    Default Re: IRA Deposits Made Shortly Before Filing Bankruptcy

    You still have to declare/list the IRA as an asset. (even though they are normally exempt) If they determine that your *recent* transfer of the savings to an IRA was to keep the money exempt & from your creditors, you could have a problem & the IRA money may not be safe/exempt after all from your creditors.
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