"IRAs are protected in bankruptcy only if the IRAs are tax exempt. IRAs are tax exempt only if they do not engage in prohibited transactions. One prohibited transaction is the direct or indirect loan between the IRA owner and a party in interest, such as the bank or other financial institution that holds the IRA assets (IRA Custodian).... Recently the DOL declared that boilerplate provisions in IRA account documents that allow the IRA Custodian to offset amounts in the IRA against debts owed to the IRA Custodian by the IRA owner constitute a prohibited loan.... The Sixth Circuit Court of Appeals ruled that the IRA would be protected. The court concluded that because the debtor had no other account with the IRA Custodian, there was no way in which the improper offset could have occurred." [Daley v. Mostoller, No. 12-6130 (6th Cir. June 17, 2013)]  MORE >>