Leave of Absence

[4bkstuff]

I am taking a 3 month leave of absence (not the primary bread winner) due to some personal family/and health issues with daughter that need my attention. If my "Leave" is not approved by my employer I have already given my 2-week notice, effective the same date my personal leave would start if approved.

We have retained a lawyer a long time ago - he said it should not be a problem for me to take a leave or quit my job prior to filing a BK. We don't know how soon we would need to file, but eventually we will because our HELOC mortgage company has a judgment against us. If we are able to wait, and I do not go back to work within 6 months we would be just under the median for our family - a bonus.

My question is, if I have to quit my position (already have been told that I am rehire-able at any time and they would welcome me back) what would happen if we cash out my 401K (less than 7k in it at this time)? I mean, would the trustee count that is income for the month I cash it out? We would either use that to upgrade our older car (paying cash and trade in) or use it for other needs. Any advice would be appreciated. Thanks.

[sunshinepa]

I believe it would count as income if within 6 mos. of filing. You would be better off holding on to it, filing and then cashing it if needed. However, the best thing to do would be just leave it alone if you really do not need it to live on after BK.

[4bkstuff]

That is what I thought also. I think we will leave it alone. Our car is in running order at this time anyhow. I would prefer to leave it alone anyhow due to the huge tax penalty.

[shark66]

Why are you taking a leave of absence, and not pulling FMLA? You're entitled to 13 weeks for a *variety* of reasons, including caring for a family member...

Good luck.

[4bkstuff]

Yes I did consider that and I may have qualified for that - but because my daughter is a teenager and does not need "full-time" observation, and we have other personal/marital issues to deal with, I did not know for sure if it would qualify. This just felt like the right leave to take considering the circumstances. Thanks for the feedback!