Posted on: 06th May, 2010 06:35 pm
Of course I have to make repays on the loan that I have taken from my 401k plan, my question is can I write this off under a chapter 7 bankrutcpy?
Hi jackieblain!
Welcome to forums!
As far as I know, you will have to include your 401(k) or other retirement accounts, as assets in a bankruptcy. However, retirement accounts are almost always "exempt," and thus trustee would not have any right to these assets and would would be able to keep them. In some states, the 401k loan is considered a secured debt and the continued deduction for the loan payment will be considered as an allowable deduction. You should have a word with your bankruptcy attorney in order to check out whether or not you will be able to write it off.
Feel free to ask if you've further queries.
Sussane
Welcome to forums!
As far as I know, you will have to include your 401(k) or other retirement accounts, as assets in a bankruptcy. However, retirement accounts are almost always "exempt," and thus trustee would not have any right to these assets and would would be able to keep them. In some states, the 401k loan is considered a secured debt and the continued deduction for the loan payment will be considered as an allowable deduction. You should have a word with your bankruptcy attorney in order to check out whether or not you will be able to write it off.
Feel free to ask if you've further queries.
Sussane