IRA Creditor protection
My client, a Minnesota resident, has over 1 million in his rollover IRA(the rollover came from his former employer’s plan). Several years ago he signed as a guarantor on a land develpment plan. The development is in bankruptcy. Is my client’s IRA at risk?
Permalink Submitted by Alan Spross on Mon, 2008-06-23 20:18
Please see following link for MN creditor protection.
http://www.assetprotectionbook.com/state_resources.htm
You will see that it does compare poorly with other states at only 60,000 plus an inflation adjustment. The good news here appears to be that MN has not opted out of the federal bankruptcy protection provisions that include unlimited protection in federal bankruptcy IF the IRA is a rollover, ie. came exclusively from an employer plan rollover. So, while he could probably protect his IRA, his other assets would be exposed with the bankruptcy filing that is required to trigger the protection.
This federal law is only a couple years old, and several issues are yet to be tested, so take the above as a general indication. He should also be taking this up with a BK attorney in MN.