UNITED STATES SUPREME COURT RULES: An Inherited IRA Is Not Protected From Bankruptcy Proceedings Under The Retirement Funds Exemption

Dear Clients, Colleagues, and Friends,

Last week, there was an extremely important case decided by the U.S.Supreme Court in the case of Clark v. Rameker. In Clark, Heidi inherited a traditional IRA from her mother in 2001, when the IRA was worth approximately $450,000. Nine years later, Heidi and her husband filed for Chapter 7 bankruptcy and identified the inherited IRA, then worth approximately $300,000, as exempt from the bankruptcy estate under the retirement funds exemption of the bankruptcy code. The case worked its way up the appellate court system and was in conflict with another case that had a contrary holding. So the Supremes took the case and unanimously decided that funds held within inherited IRAs are not considered “retirement funds,” and thus not protected from creditors in bankruptcy proceedings. As a result, Heidi’s inherited IRA was available to satisfy her debts in the bankruptcy proceeding. Continue reading

#1 Question About Offshore Asset Protection Trusts – Will I Go To Jail?

Dear Clients, Colleagues, and Friends,

“Am I going to jail?”

Andrew’s creditor just asked a court to hold him in contempt for failure to pay a multi-million dollar judgment.

Andrew’s eyes were wide with disbelief. “I’ve done everything they asked, but I can’t pay the judgment if the trustee refuses to release funds.”

“Don’t worry,” explains Andrew’s lawyer, “this is how the trust is supposed to work.” Continue reading

Lawsuit, Interrupted

Dear Clients, Colleagues, and Friends,

In 2012, Dr. Brenda severed ties with her problematic business partner, Dr. Smith. Two years later, when Dr. Smith was sued for medical malpractice by eleven former patients on extremely damaging charges, Dr. Brenda was named as co-defendant solely by virtue of her former partnership.

Because Dr. Smith was bankrupt and had no personal assets, naming Dr. Brenda as co-defendant was a ploy to dig for deeper pockets. Although nine of the patients suing were never actually patients of her practice, they refused to dismiss Dr. Brenda from the case. Demanding millions in damages, Dr. Brenda discovered that the lawsuit was essentially a vehicle for legal extortion in the hope she would nevertheless settle to protect her name and reputation. Continue reading