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Maverick
Maverick, Attorney
Category: Bankruptcy Law
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Experience:  20 years of professional experience
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Is a 401k, which was a lump sum pay out on retirement protected

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Is a 401k, which was a lump sum pay out on retirement protected by law, if a chapter 7 bankruptcy is file. State of residence is Mississippi
Submitted: 7 years ago.
Category: Bankruptcy Law
Expert:  Maverick replied 7 years ago.

Here is the Mississippi law on pensions and retirement plan exemptions:

 

IRAs and Keoghs, unlimited amount exempted , but must be deposited more than one year before filing bankruptcy [85-3-1(b)(iii)];

 

retirement benefits, unlimited amount if deposited more than one year before filing bankruptcy [85-3-1(b)(iii)];

 

private retirement benefits, unlimited amount if tax-deferred [71-1-43];

 

I was not able to find any MISS law that would speak to your specific issue without the use of a third party fee based service. Further, this is a difficult issue to address. However, it appears that the general law on this issue is that so long as you can trace the funds directly back to the retirement distribution and that such funds have not been commingled with non exempt funds or assets, the 401k exemption should still apply to the lump sum distribution.

 

 

Please click "Accept" so that I can get credit for this answer. We can continue our conversation after that at no additional charge.

 

 



Edited by Maverick on 12/2/2009 at 5:51 PM EST
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