Is an inherited pension protected in Chapter 7 bankruptcy? I get $1,500 per month from the pension until my father passes away.
Since this is an inherited pension, is it considered an asset? Or considered just income? Can the court say it is an asset and attach to the future income, an asset that cannot be protected with 703 or 704 exemptions? I don't have any other assets and have only make $1,800 per month from employment. I just want to make sure that this pension can be protected since it was an inherited. I know regular pensions are protected, but what about this
5 attorney answers
There is recent case law regarding inherited IRA's which might apply to your situation. Even if you don't think you can afford it, consult with an experienced bankruptcy attorney to investigate the issue so that you don't have problems later if you do file.
This response is not intended as legal advice. You may need to consult your own attorney to obtain a more specific answer.
The pension is both ans asset and income.
Present value of income stream is and asset.
Monthly income is income.
To be honest, I'm not sure. But contrary to my colleagues, my gut instinct is that it is an asset, being an income stream that is probably assignable.
It may not be an asset of the BK estate, but it is considered income and should be used when calculating the "Means Test". BK is not a DIY project. Find/consult/hire an Avvo lawyer by clicking the tab "Find a Lawyer" in your area. Many of us offer a free consultation.
You are not my client and I am not your attorney. This advice is given in the spirit of the AVVO platform and is based on general legal principles. You become a client when you enter into a formal retainer agreement with me.
If you can only received the money in a monthly basis and cannot cash in the funds to receive a lump sum payment, then the pension would not be considered an asset of the bankruptcy estate. Thus, it does not matter if the pension is exempt or not, because it has no present day value.
Answers and comments provided are for general discussion only. My comments are not to be considered legal advice and they do not create an attorney-client relationship.