There is much discussion these days about income tax reform. The tax code has historically been completely reformed about every thirty years and the last reform was about thirty years ago.
There has also been significant speculation as to whether the Federal Estate (a/k/a the Death Tax) is on the chopping block. Will repeal happen? When will repeal happen?
Given the dysfunction that is Washington these days, all anyone can do is speculate. So let me speculate…
Replace? The short version is that Donald Trump Continue reading Death Tax: Repeal or Replace?
Yesterday, Justice Sotomayor delivered the unanimous opinion of the Court that Inherited IRAs are NOT exempt in bankruptcy proceedings.
Read the full opinion here: Clark v. Rameker.
Central to the Court’s opinion was the interpretation of the phrase “retirement funds.” In bankruptcy, an individual is allowed to exempt certain of their assets from the proceedings. The code specifically sets out what can be exempt and what cannot be. One such exemption is “retirement funds to the extent those funds are in a fund or account that is exempt from taxation under section 401, 403, 408, 408A, 414, 457 or 501(a) of the Internal Revenue Code.” Clark v. Rameker, No. 13–299, at slip op. at 1-2 (June 12, 2014) (citing 11 U.S.C. § 522(b)(3)(C)(d)(12)).
Continue reading SCOTUS: Inherited IRAs are NOT exempt from Bankruptcy.
UPDATE: The Supreme Court has ruled on this matter. Click here to read more.
Are Inherited IRAs Exempt from Bankruptcy? That is the exact question that will be argued before the United States Supreme Court. Click here to read more. Keep up with the latest on the case by clicking here.
An Inherited IRA is what your retirement account is called in the hands of your named beneficiary (e.g., your child) after you have passed away.
There is no question as to whether retirement assets are exempt in bankruptcy. The question before the Court is whether Congress intended an inherited retirement account to be included in that protection.
Continue reading Are Inherited IRAs Exempt from Bankruptcy?