How to Freeze an IRA Account

Individual Retirement Accounts are supplemental retirement savings accounts that are generally protected in bankruptcy and creditor filings in most states. They are highly protected to prevent IRA owners from becoming a burden to the state. There are still situation where an IRA can be frozen until a legal dispute is settled: divorce, judgments against unprotected IRAs or beneficiary disputes. Until the legal matters are settled, the IRA is frozen, with the IRA owner unable to take distributions without court approval.

• 1

  Obtain a court order to freeze IRA assets specifically stating the IRA account owner's name, the IRA custodian's name, address and account number. Orders need to be specific; otherwise, the custodian may not be obligated to freeze the account.

• 2

  Provide the IRA custodian with a copy of the court order signed by the judge. You may serve the custodian or send the document via certified mail requiring a signature guarantee.

• 3

  Follow up with the custodian to make sure the order was received and the IRA account is indeed frozen.