Impact of legal judgment on 401k vs IRA?

Question

I have a 401k account with a former employer. I am considering rolling it over into an IRA.

I have heard that one downside of doing this is protection from a legal judgment.

I heard that a 401k is considered a retirement plan and cannot be used to pay if I am sued and loose. On the other hand, an IRA is an asset that can be seized to pay the judgment.

Anybody know if that is true and does it vary by state?

Thanks In Advance

Answer 1

Lucky you
the new bankrupcy law that Bush signed in Oct/2005.
In addition to 401k, IRA Plan, Roth IRA plan are exempt or virtually untouchable by any judgements

Answer 2

what Hoa n said is true
and even in a worse case scenerio you could have the judgement set aside which would release the lien power