Inherited IRAs are Not Creditor Protected - #2
I previously blogged about a Bankruptcy Court in Texas holding that an inherited IRA was not exempt from claims of the new owner's creditors. In re Jarboe, 2007 WL 987314 (Bkrtcy S.D. Tex. 2007).
A new ruling out of Florida reaches the same conclusion, stating:
"[t]he purpose of the . . . Legislature in exempting individual retirement accounts is to allow debtors to preserve assets which have been earmarked for retirement in the ordinary course of the debtor's affairs. Such a purpose would not be served by upholding [the beneficiary's] request to keep his interest in the IRA as exempt." (Second District Court of Appeals in Robertson v. Deeb (2D08-6428))
Given that Texas and Florida are perhaps the two most debtor-friendly states in the nation, this trend is certainly something to be concerned about. It's probably just a matter of time before we see such a ruling in North Carolina.
Don't wait until it's too late - protect your legacy by using a standalone IRA Trust.
