Hi, thanks for your question. You should hire a lawyer for specific legal advice. No attorney client relationship is created here.
It will probably be unlikely that you qualify for chapter 7
You'll be making about $96k post retirement, per year.
In order to file chapter 7, you must 1) pass the means test calculation.
2) your monthly income must be equal to or less than your monthly necessities.
3) you can only exempt certain assets with your available exemptions. any amounts greater than your exemptions are subject to liquidation.
You hit it on the nose, that deposits are subject to levy if the creditors obtain a judgment against you.
What is the 'federal tax deferred savings plan? "
If you don't qualify for the chapter 7, you can look at chapter 13, to repay debt to protect your assets, based on your disposable monthly income.
You can pay anywhere from 10% to 100% based on the chapter 13 means test calculation
You'd be best off talking with a local bankruptcy attorney to review these issues, and help set you up on the best plan of attack based on the facts of your case.
What questions do you have?
The fedeeral tax deferred savings plan is called TSP or Thrift Savings Plan, it's akin to a 401K plan for federal employees.
That should be exempt while the funds are in that account, once they hit your checking, they are fair game
I guess my big question is if all my income is retirment income, how can my creditors come after that income? I thought all retirment income was exempt.
it is, while it is in the retirement account
once it hits your bank, it can be used to satisfy a garnishment unless the court orders otherwise.
What if I have the money deposited to an off-shore account? Can the creditors levy on those accounts as well?
it depends on how crafty and smart the creditors attorneys are.
This is all irrelevant though with a bankruptcy.
Well, here's the likely scenario: my wife and I may decide to relocate to New Zealand where she is a citizen. If I have my social security and other retirment benefits direct deposited to a bank in New Zealnd, is it likely my creditors will go to that exopese to levy in NZ? About three of the accounts are in the $20K rangge, the rest are less.
if you move, it's unlikely your creditors would pursue you there. Any of the bank accounts you have here, though, could be frozen if they do sue.
I'm okay with bank accounts being frozen (since I plan to leave nothing in them). I assume they cannot freeze the retirment accounts?
Okay, Terry, sounds like I need to consult a bankruptcy attorney before doing any of this. Your answers were very helpful. Thanks.
It would be the smart thing to do, just to protect all of your bases.
Let me know if you have any other bankruptcy questions.
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