IRA account withdrawal

[isaiah60]

I closed my IRA account and deposited into a checking account in my name. Was this a mistake- Its only $2000 but I plan on using it to help with my filing fees and attorney fees.

How does the court view this?

isaiah60

[keepmine]

You won't be the first to loot an IRA to pay legal fees and ordinary living expenses. Just keep receipts of what you spent the money on in case anybody asks {not likely}.

[NASCAR20FAN]

I closed my IRA account and deposited into a checking account in my name. Was this a mistake- Its only $2000 but I plan on using it to help with my filing fees and attorney fees.

How does the court view this?

isaiah60

that shouldn't be a problem. I withdrew all the money from my IRA's before I filed. I plan of starting back up with my accounts in a few weeks. I didn't close them, just withdrew the money.

[lrprn]

One problem you'll have is at tax time next year. If you have a traditional IRA (not a Roth), the $2000 is taxable plus there's a 10% penalty tacked on for early withdrawal if you are under 55 years of age. Luckily though, since you are filing Ch 7, you should be discharged by April 15 and can pay Uncle Sam his due then. Good luck with your filing - hope it goes smoothly for you!

[anonymuse]

If you are disabled, that penalty can be waived.

[bkadv]

Just wondering, can an IRA be withdrawn after case is filed? It's been almost a year and our case is still not closed. We are sinking because I've not been able to work for some time.