Clark v. Rameker (2013)
- Docket
- 13-299
- Decided
- 2013-01-01
Summary
Question: Does the U.S. Bankruptcy Code exempt an inherited IRA from a debtor's estate in bankruptcy? Conclusion: No. Justice Sonia Sotomayor delivered the opinion for the unanimous Court. The Court held that an inherited IRA account did not qualify as a retirement fund for the purposes of exemption under the U.S. Bankruptcy Code. Since the Bankruptcy Code does not explicitly define the term "retirement fund," the Court held that it should retain its ordinary meaning—a fund that is set aside for an individual's retirement. Inherited IRAs do not fit this definition because the individual cannot invest more money in the account and is required to draw money from the account regardless of how far the individual is from retirement. The Court held that allowing an inherited IRA to be exempt from creditor claims would undermine the purpose of the Bankruptcy Code.