Tag Archives: retirement

Is my 401K Safe in Bankruptcy?

401k pic

When you are struggling financially and being harassed by creditors, the idea of getting safe refuge in bankruptcy can be quite appealing. However, most people are afraid to take this step because they fear what will happen to their assets. A significant assets for most individuals is their retirement account. Fortunately, federal bankruptcy law provides protection for qualified retirement accounts. In fact, the law sets forth an exemption that removes a qualified 401k, pension, profit sharing or Individual Retirement Account (IRA) from being included in your bankruptcy estate. Most state bankruptcy laws have a similar exemption as well.

When it comes to protecting an IRA, the maximum amount that can be exempted is $1,245, 475 per individual. This is a substantial sum and most debtors have accounts that are well below this amount, so they are protected fully. However, if your IRA account exceeds the cap, you should consult with your bankruptcy lawyer to discuss your options.

In fact, if you are planning to file a personal bankruptcy, you should consult with an attorney to verify that all of your retirement accounts qualify for the exemption. This is also true if you have taken a loan against your 401k account. A loan against your retirement account may add some complexity to your filing, so it is important for you and your attorney to be prepared to address the issues.

Claiming all of the applicable exemptions to safeguard your assets is essential to having a successful bankruptcy case. When you have your initial consultation with your bankruptcy attorney, you should provide all of the records regarding each of your retirement accounts to confirm that the funds will be protected.

Call us today to schedule your initial consultation. Our office is located in Melbourne, but we proudly serve individuals and businesses across the State of Florida.


Is it Time to Sell Your Business?

As a business owner, you may be trying to decide when or if to sell your company. Do you wait for it to hit a certain size? Does it need to be worth a certain amount? These are common approaches, but maybe there is a better way to determine when to hang out the “for sale” sign. Put simply, when you reach the point where you can sell your business and amass sufficient funds after the taxes are paid to live “comfortably” for the rest of your life, it is time to sell. Otherwise, prolonging the sale has no meaningful upside.

Sell Your Business | Brevard County Attorney

How do you know when you have reached this point? First, you must determine how much money you need to live on each year for the rest of your life. Most people overestimate this number, so try to be realistic.

You must also determine what your company is worth. There is no clear-cut formula for calculating its worth, but it is important to at least have a rough estimate of its value. You may want to hire a professional to help you with this task.

It is important to understand how much money will belong to you after the sale. Thus, you should make sure you understand your tax liability and the expenses related to the sale. Again, you should seek the assistance of a professional with this task. It may be possible to take certain steps before the sale, such as restructuring your company, to decrease your tax liability before you sell.

Once you have the full picture, you can make a smart decision on whether or not to sell your business. If you can meet your financial goals by selling now, prolonging the sale will only subject you to risk. It is important to ask yourself if there is some reason beyond simply funding your retirement that justifies holding on to the business.

Contact a Brevard County Bankruptcy Attorney at Faro & Crowder, PA

If you are interested in discussing your business, contact Faro Crowder, PA to schedule an appointment. We are located in Melbourne, Florida on Sarno Road and serve residents and businesses of the Space Coast and Brevard County.

Services Areas

We provide services throughout Central Florida including: Melbourne, Titusville, Palm Bay, Merritt Island, Cocoa, Cocoa Beach, Satellite Beach, West Melbourne, Cape Canaveral, Viera and Eau Gallie.

Get In Touch with Faro & Crowder, PA

Faro & Crowder, PA
Phone: 321-784-8158
Address:
1801 N. Sarno Road, Suite 01
Melbourne, FL 32935
Email: info@farolaw.com

The information on this blog or any blog is not intended as, and should not be taken as, legal advice.

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