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  1. #1

    Default Is IRA and Roth IRA Safe from Creditors Who Have a Judgment

    California

    If someone has a judgment already, can the debtor keep depositing into their ira and roth ira and have it not able to be touched? I've been told a 401k and ira are safe in most cases when someone files for bankruptcy. I'm curious if one doesn't file bankruptcy can their ira and roth ira not be touched. I know bank accounts can be seized.

  2. #2
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    Default Re: Is IRA and Roth IRA Safe from Creditors Who Have a Judgment

    In most cases your retirement accounts will be exempt from garnishment. I could see a creditor trying to set aside a transfer as a "fraudulent conveyance" if you are putting money into your retirement accounts to make yourself uncollectable; whether that would succeed will depend upon the specific facts.

  3. #3

    Default Re: Is IRA and Roth IRA Safe from Creditors Who Have a Judgment

    Yeah, that's what I was thinking. I know one can put a maximum of 5500 into an Ira per year for tax purposes, but I was wondering if there was a maximum for a Roth Ira since it isn't so much a tax shelter. I have a list showing tax exemptions, but I didn't have Roth Ira on the list. Nobody is garnishing me, but with a judgment it could happen in the future or never. I just want past deposits to be safe, not so much current transfers. Most likely I would use a 401k, and Roth Ira to save for the future. Thanks Mr. Knowitall.

  4. #4
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    Default Re: Is IRA and Roth IRA Safe from Creditors Who Have a Judgment

    Read this.
    Quote Quoting Maximum IRA Contribution
    2010 Combined Traditional and Roth IRA Contribution Limits

    If you are under 50 years of age at the end of 2010
    : The maximum contribution that you can make to a traditional or Roth IRA is the smaller of $5,000 or the amount of your taxable compensation for 2010. This limit can be split between a traditional and a Roth IRA but the combined limit is $5,000. The maximum contribution to a Roth IRA and the maximum deductible contribution to a traditional IRA may be reduced depending upon your modified adjusted gross income (modified AGI).

    If you are 50 years of age or older before 2011
    : The maximum contribution that can be made to a traditional or Roth IRA is the smaller of $6,000 or the amount of your taxable compensation for 2010. This limit can be split between a traditional and a Roth IRA but the combined limit is $6,000. The maximum contribution to a Roth IRA and the maximum deductible contribution to a traditional IRA may be reduced depending upon your modified AGI.

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