Bankruptcy and Your Retirement Accounts
People who are struggling financially often look for a “quick fix” to solve their financial problems. Sometimes they believe that cashing in or borrowing from their retirement accounts is the care for their financial ills. Actually, they are completely wrong.
In Ohio, most retirement accounts such as IRA’s, 401(k)’s, and pensions are protected from creditors.
When you pull money from a retirement account you normally must pay federal and state income taxes. Furthermore, if you are under the age of 59 ½ there is likely a 10% penalty.
Many people deplete their retirement accounts yet still find themselves in a financial mess.
Before you withdraw money or even borrow money from a retirement account, you should speak to an attorney who deals with debtors’ rights and bankruptcy.
Toledo Ohio based attorney Fred Boyk is available at (419) 327-6160 for a free consultation regarding your financial problems.