bankruptcy questions 401k
chapter 7 question?
What happens in a bankruptcy if anything when you cash out your 401k? We do not have our petition filed yet with the bankruptcy court but just curious to see if anyone knows what could happen. Thank you and please no critics
we actually cashed them out already for an emergency but we have not filed with our states bankruptcy court (Wisconsin). Will that just go into earned income so far this year maybe?
There are certain “exemptions” as to what can be liquidated under Chpt 7. States vary in what they consider “exempt” such as property and other assets.
Here is a link to find your states exemptions
http://www.filing-bankruptcy-form.com/bankruptcy-exemptions.html
Filing chapter 7 bankruptcy usually results in a discharge of debts, but your right to a discharge is not absolute, and some types of debts are not discharged. Additionally, a chapter 7 bankruptcy discharge does not remove a lien on property.
LEGAL DISCLAIMER: The advice contained herein is for informational purposes only. It is not to be construed as Legal Counsel nor Legal Advice.
