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I am in a chapter 11 bankruptcy, can I open up an ira account?

Las Vegas, NV |

filed two years ago to stop a foreclosure and negotiate a modification on our home. Did not file for credit card debt. The note had been sold several times and also again during the bankruptcy.

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Attorney answers 4

Posted

Typically not, but speak with your bankruptcy counsel about this. Paying yourself via IRA before paying your creditors can spell disaster for the success of your case potentially.

The concept of 'not included' is a misnomer for any kind of debt in bankruptcy: if it is a personal case (which it sounds as though it is ) it IS included and you must address it.

As says before, talk to your lawyer right away as is seems there are major issues facing you as well as a misunderstanding about the process in general.

Good luck!

Posted

Are you sure you are in a Chapter 11 and not a Chapter 13? I can't imagine why you would be here talking with us if you worked closely with your counsel and it was able to confirm a Chapter 11 Plan of reorganization.

Usually, the Plan governs everything. If there was no "(a)(15)" objection, you can do whatever you want with excess disposable income, including paying into an IRA. Even if your lawyer is $600 per hour, spend $600 bucks for an hour of their time so you don't do anything that interferes with your Chapter 11.

If you don't trust your attorney (which you shouldn't) then I recommend you get a new one to take a look.

The reason I wouldn't trust your attorney is what is all this garbage about not including credit card debt? there is no such thing as that. You MUST include all debt!!

Be sure to designate "best answer." If you live in S. California, you may call my firm for a consultation 818-507-6000. The above is general legal and business analysis. It is not "legal advice" but analysis, and different lawyers may analyse this matter differently, especially if there are additional facts not reflected in the question. I am not your attorney until retained by a written retainer agreement signed by both of us. I am only licensed in California. See also avvo.com terms and conditions item 9, incorporated as if it was reprinted here. Please visit my web site: www.tilemlaw.com for more information about my services.

Posted

I doubt you are actually in Chapter 11. It's much, much more likely you are in a chapter 13, unless possibly your attorney filed an 11 for you because your debt level was too high? It's possible, but rare.

Assuming you do have a plan payment you are making to a confirmed Chapter 13 plan, yes, you could open an IRA. Your lawyer should be directing you, however, especially if you now have the ability to contribute to an IRA if your income has increased.

This is AVVO, a place for users to obtain general legal information to general legal questions. I am glad to help you in any way I can, within those limits. I wish to make clear I am only communicating with you for the sole purpose of exchanging such general information, and nothing more. It is not legal advice, which I can not provide because among other reasons I know few of the necessary details of your situation. I do not purport to represent you in any way, shape or form. Of course, if you would like to seek out my services, and if you are a NY resident, I will probably not put up very much resistance but representation would still necessitate a signed retainer agreement between yourself and I. Thank you.

Posted

There are multiple things wrong with what you wrote here.

You need to talk to you bankruptcy attorney. If you are trying to do an 11 without one, no sane qualified attorney is going to advise you on this over the internet, any more than you could get advise on your own brain surgery.

On top of that, you don't "not file for credit card debt." *YOU* file, and you are obligated to disclose everything.

Michael Avanesian

Michael Avanesian

Posted

Great answer!

Asker

Posted

Let me clarify... I must have been too vague... I meant we didn't file because of credit card debt.. my credit card debt was minimal.... just around $1,200. We filed to stop a foreclosure. This has been going on for over two years... I am in the middle of looking for a new attorney since the one we have was not very informative, didn't answer most questions we asked... Such as if we are able to get a new USED car, since our car broke down and it was going to cost a few thousand dollars to fix it. Never got an answer... was over 10 months ago. It seems the lawyer is just milking us for money and not really having much progress. I consulted one new lawyer just recently because I didn't think our lawyer was working in our best interested and was dragging things out and I was told that the lawyer we have had not filed our treasury report since last October and had not gone to court since last August . However, our lawyer had recently told us she was just in court on our case and the judge was "cranky" about the other sides lack of response? Sounds like we are being taken....

Michael Avanesian

Michael Avanesian

Posted

I am sorry for butting into this thread but what you've described is not uncommon (although it is very sad). The #1 thing you should look for in an attorney is trustworthiness. Why don't you give Mr. Hawkins here a call. Whatever you do, don't delay you decision. The longer you drag your feet, the worse off you'll be.

Richard Edmund Hawkins

Richard Edmund Hawkins

Posted

"The other side" doesn't make sense. The UST's office, or the bank on a cramdown? If you haven't filed operating reports since October, expect a motion to dismiss any day; Jonas Anderson is working his way through the backlog.

Asker

Posted

The other side is the opposing council for the bottom feeding vulture lender that bought our note during our foreclosure and bankruptcy.... there has been supposedly ongoing negotiations to settle the note, however, I feel we are being milked for money and their has been no movement for two years... I am at my wits end... I have been telling my husband something is wrong for the longest time... I will discuss this with him. Thank you.

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