In In re Elizabeth Bratton Moore, the Bankruptcy Court for the Eastern District of Texas (Sherman Division) ruled that the exemption for IRAs in Section 42.0021 of the Texas Property Code applies not only while the funds are held in the IRA but also to any distributions received from the IRA.

An IRA is an individual retirement account described in the Internal Revenue Code.

The bankruptcy trustee argued that the exemption only applied to distributions that are timely rolled over to a new IRA.

The court rejected the trustee’s comparison to the similar rule for homestead sales proceeds and held that the wording of the Texas IRA exemption applies not only to the IRA but also to the right to receive payments from the IRA. (July 6, 2016).

Court’s Opinion is here