Quote Quoting Brian57
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As we all saw in the OJ Simpson case, a pension (and possibly a 401K) is untouchable.

When a person trades his right arm for a $1M, that money sitting in an acct is essentially his right arm in the form of cash. How could a person be forced to give up his right arm to settle a debt?

My wife recently received $35K for a workman's comp personal injury claim and my EA says it was all non-taxable.

I cannot see how any of your right arm money could be seized during a bankruptcy. Well, maybe the past and future lost earnings of that money could be seized because that is income compensation, not right arm compensation.

Sure, I don't sound like I know the law, but you guys don't sound like you know for sure either.
Whether or not it is taxable does not, in itself, mean it is exempt or not from bankruptcy claims. It means it falls within income that is not taxable and nothing else.

As to those you referred to that sound “not sure” of the law; until the laws are applied to a very specific set of facts, it is no different than a hypothetical situation. Facts matter and unless all pertinent facts are known, there is no absolute answer. Most answers are couched so as to allow for unknown facts to result in different answers

What happened in the OJ civil suit has nothing to do with what happens in a bankruptcy situation. Assets available to pay civil suits differ from what is dealt with in bankruptcy actions.