401K & availibility after bankruptcy

[bkfiler]

ok i talked with an attorney. cost me $150 bucks - didnt help me a damn for my questiuons but i got one for you.

as long as the 401K was legally exempted and fully documented then you can take as much as you want out of it after your case is discharged.

oh Fu#&#*^&#^&$ hell! i forgot to ask about closed or not. why does this have to be so hard lol.

as long as its a ERISA account, was fully exempted and disclosed then you are fine. one reason for this is because these accounts do not belong to the estate. the exemption takes it away from the bastard trustee and slaps his hands when he starts salavating over it. that connection and the exemtpion allows you to do as you please.

remember though, its beter to gete a job because you will pay 10% fine right off the top even if you use it because you are unemployed. ask me i know lol.

also, remember that you have 60 days to get it back in there to avoid the fine. ask me i know lol. i should have put mine back in.

the worst part is every time i go do that it seems like the laws stay the same and i get fined haha. youd think theyd change sooner or later on that issue.

[bkadv]

So....I'm still not sure. The conclusion is.....that the 401 is exempted and can be taken at anytime after discharge?

[bkfiler]

huh? i just told you that its safe if its ERISA 401K and full exempted already.

exempted means during the bk the trustee cant touch it.

as soon as your case is discharged and closed then you can do with it as you please.

[FoolAndHisMoney]

Trust me if they find fraud after the discharge and the courts have to reopen the case you can bet what little money you have they won't put you in a chapter 13. They would revoke your discharge and throw you to the wolves.

[bkadv]

I figured as much...wanted some opinions and I got them! I think the 401 will stay put. Even attorneys don't seem overly confident on this one.

[bkfiler]

now why do you want to confuse the poor guy. he didnt commit fraud.

[bkfiler]

i just paid $150 for an answer for you and you dismiss it for advice from non-attornys.

maybe the 401K should stay put. good idea imo anyways

[Busted42]

I'm in desperate need of cash and I can borrow about $3500 from my retirement fund. My case hasn't been discharged yet, supposedly next month. Should I wait until discharge to borrow? Remember, I said desperate need of cash.

Thanks

[bkfiler]

i have no idea.

tell people what for?
what kind of fund?
what status your bk is in?
did you ask your attorney?
what kind of bk case?
have there been any problems with the case?
etc?
why not ask the trustee to be sure if you dont have an attorney?

side notes:

- if its a 401K did you know that you may be able to put the money back within 60 days without penalty?

- also, taking from those accounts are not a good idea. why not get a job doing anything for short term.

well just some ideas anyway.

[FilingOnMyOwn]

3,500 might be risky. Why so much? Keep it under 1,000 TOTAL and you should be relatively safe. And pay it back as soon as you can.

[Busted42]

3,500 might be risky. Why so much? Keep it under 1,000 TOTAL and you should be relatively safe. And pay it back as soon as you can.

I would be borrowing from my state retirement fund (NY)...which is normally paid back over the course of 5 years. The money is needed for 'living' purposes: food, heating oil, bills, etc: My income is about even or less with my outgoing, so I'm living week to week, and it is really tough. Thanks for any and all replies.

[JeepMom]

We took out the 401K funds and used it to move, buy new furntiture, and other household items. We were not discharged at that point.

Warning on withdrawing 401K money is there are HUGE tax penalties. We didin't have to pay ALL the penalty because dh had quit his job and that's a reasonto withdraw it.

[Busted42]

We took out the 401K funds and used it to move, buy new furntiture, and other household items. We were not discharged at that point.

Warning on withdrawing 401K money is there are HUGE tax penalties. We didin't have to pay ALL the penalty because dh had quit his job and that's a reasonto withdraw it.

I only have to pay tax is if I take out less than a maximum loan. That is why I would be withdrawing $3500, instead of say, $1500.

JeepMom: did you inform the trustee about the withdrawal of the 401k?

[JeepMom]

No, but we did tell him that we moved

[FilingOnMyOwn]

Yeah at least wait until after your discharge before you do anything.