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News and Articles
The
IRA Steps Out
Forbes, June 5, 2006
Buying Real Estate from a Self-Directed IRA
Morningstar, June 2006
Self-Directed IRA Myths Can Result in Heavy Costs
Realty Times, May 8, 2006
Self-directed IRA and IRA LLC for Real Estate
Realty Times, March 20, 2006
Blaze Your Own IRA Trail
Businessweek, February 6, 2006
Use
Little-Known Retirement Accounts as a Source for Private
Investor Capital
Commercial Mortgage Insight, October 2003
Buy Real Estate in Your IRA
Realtor Magazine, September 1, 2003
Investors Find Ways to
Put Pension Money Into Real Estate
Wall Street Journal, May 21, 2003
Add a house to your IRA
Businessweek, Nov. 18, 2002
IRA Holders Add Real Estate To
Their Mix
Wall Street Journal, August 14, 2002
WASHINGTON, April 4, 2005 - The Supreme
Court unanimously ruled that under federal bankruptcy law,
Individual Retirement Accounts (IRAs) are protected from
creditors in bankruptcy proceedings. This means that the
savings for the estimated 45 million Americans who hold IRA
accounts today, are safeguarded under law just as 401k plans,
pensions, social security and other benefits tied to age,
illness, disability or death.
The decision for the case Rousey v. Jacoway,
03-1407, written by Justice Clarence Thomas states that IRAs
were a payment "on account of age" because account holders
must pay a 10 percent penalty if they withdraw funds before
they are 59 ½ years old.
The lower courts, argued that because people can make early
withdrawals from IRAs, it makes them more like savings
accounts, which are not protected from creditors under
bankruptcy law. Thomas noted, however, that IRA withdrawals by
those younger than 60 are few, effectively making the account
a benefit based on age. "That penalty erects a substantial
barrier to early withdrawal" Thomas wrote "The deterrent to
early withdrawal it creates suggests that Congress designed it
to preclude early access to IRAs." This ruling comes at a time
when there are an estimated 1.6 bankruptcy filings per year
compared to 875,000 a decade ago, when these laws were not in
effect.
This new ruling affects people living in
Washington, D.C. and 16 other states including: Alaska,
Arkansas, Connecticut, Hawaii, Michigan, Minnesota, New
Hampshire, New Jersey, New Mexico, Pennsylvania, Rhode Island,
South Dakota, Texas, Vermont, Washington, and Wisconsin. These
16 states do not have their own laws protecting retirement
savings. The remaining 34 states including: New York,
California and Iowa have language that mirrors the federal
bankruptcy statute. The new decision on April 4th overturned a
2003 ruling by the US Court of Appeals for the Eighth Circuit
in St. Louis, Missouri.
For further information on this decision or
to read the full text of the statute go to
www.aarp.org or www.supremecourtus.gov.
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