The Law Office of Kim Covington Kim Covington Bankruptcy Lawyer Kim Covington Bankruptcy Lawyer

Will my retirement be liquidated in my Chapter 7 bankruptcy?

The promise of relief from overwhelming debt may be making you eager to file Chapter 7 bankruptcy in Oregon. On the other hand, after years of contributing to your retirement account, you may be worried that liquidation of these funds will leave you destitute or prevent you from retiring at a reasonable age. The U.S. Bankruptcy Court for the District of Oregon explains that there are a number of sources of income that will not be affected when you file.

Federal law protects benefits that you need to support yourself and your dependents. However, this does not include payments from profit sharing plans, stocks bonuses or pensions that are not eligible for tax exemption from the IRS. Payments from this type of plan that an insider of the debtor established will also not be exempt from liquidation.

Payments that you do get to keep come from your pension or profit sharing plan that you receive because of the length of the service you provided to your company, organization or agency. You also get to keep payments you receive because of your age or a disability or illness. This includes money from Social Security.

Oregon law prevents liquidation of your unemployment benefits and payments that you may receive from public assistance programs or workers’ compensation, as well as money provided for vocational rehabilitation. Your payments from public employees retirement funds are also exempt from liquidation. This may give you a general idea of what assets and resources you will have during and after your bankruptcy, but specifics that apply to your case may apply, so it should not be interpreted as legal advice.

No Comments

Leave a comment
Comment Information

Office Locations

The Law Office of Kim Covington

Eugene Office
1445 Willamette Street, Suite 9
Eugene, OR 97401

Map & Directions

Albany Office
1135 Dale Street SE, Suite #B
Albany, OR 97321

Map & Directions

Roseburg Office
1701 West Harvard, Suite 201
Roseburg, OR 97470

Map & Directions

Phone: 541-393-2790
Toll Free: 800-673-1891
Fax: 541-344-6466