My compliments to your magazine and Mark P. Altieri and Richard A. Naegele for their outstanding article, “Creditors’ Rights: Tax-Qualified Plans and IRAs” (October 2000). However, it should be noted that section 5205(c)(2) of the New York Civil Procedures Laws and Rules protects IRAs, Roth IRAs, and qualified plans under IRC section 401 from creditors under the state law exemptions. Included in the qualified plans category are a sole proprietorship plan and partnership plan qualified under IRC section 401. These qualified plans are protected under New York State law from creditors even if there are no common-law employees that are eligible to participate in these qualified plans.
Seymour Goldberg, JD, CPA
Goldberg & Goldberg, P.C.
Garden City, N.Y.
The Authors Reply
We would be remiss not to accept the advice (as well as the compliments) from Mr. Goldberg. We appreciate his clarification of New York law. Being aware of The CPA Journal’s national readership, we attempted to provide a planning recommendation that was a more global statement of the law applicable to the many readers in other states. Nonetheless, we should have noted the allowance under New York law relating to owner-only plans that was pointed out in Goldberg’s letter.
Mark P. Altieri, JD, LLM, CPA
Kent State University
Richard A. Naegele, JD
Wichens, Herzer, Panza,
Cook & Batista
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