I`ve been discharged,and need a question answerd.

[NEXUS]

I was dicharged a few weeks ago and am aware that the trustee could reopen my case for one year under chapter 7.Could I cash in my 401k to use as living expense while I attened school without her coming after the money, or would I have to wait the full year to touch it? Thank you for any input as this site has been a great source of information that my attorney was not.

[tdooders]

Im not sure on what circumstances the trustee needs to reopen your case. I think it has be something extreme. Was wondering though how long was it before you got your discharge papers after your last day of objections?

[HHM]

From a financial management perspective, its rarely a good idea to cash out a 401K. So I think you should explore other options for paying your living expenses, otherwise you will invariably end up in the same position the required you to file for BK.

However, if you cash out your 401K, I don't think the trustee can reopen you case for that, but I don't know for certain.

[mymymy]

hmmm, my line of thought is.. if the 401k is an ERISA and it was exempt in the original petition, then the distributions probably are exempt too.

In Florida, 401k's and their distributions are untouchable by creditors or any attachments, whatsoever. That applies whether you file for BK or not. I don't know if that's a federal thing or just a FL state statute.

Check your states laws on this. You know who was helpful to me too.. was our plan administrator from my hubby's company. Also, I spent an hour on the phone with a very helpful IRS agent, they have a department that deals only with 401k plans and the rules that apply. Don't be afraid to call your plan admin.. they are very helpful!

Have you considered taking a loan from your 401K? Are you still working? There is no tax penalty and you are paying yourself back! Trustee can't do much about that either, they don't even consider 401k loans "real" loans anyway. ( Probably really gets their goats!)

[NEXUS]

Have you considered taking a loan from your 401K? Are you still working? There is no tax penalty and you are paying yourself back! Trustee can't do much about that either, they don't even consider 401k loans "real" loans anyway. ( Probably really gets their goats!)

Yes I am considering this option also. It will more than likely be next spring before I have to make a choice so I have alot to consider.