Q.If my business declares bankruptcy, can I Keep my IRA and 401K?

A.Yes and No. The U.S. Supreme Court has held that pension plans, 401(k) plans, and other "ERISA-qualified plans" may be "excluded" from the bankruptcy estate. IRA accounts, however, do not constitute an ERISA-qualified plan. Some state statutes, however, provide that an IRA may be excluded from the bankruptcy estate. In other states, some bankruptcy court judges have held that an IRA may be partially exempt under 11 U.S.C. sec. 522(d)(10)(E).

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