Planning for your retirement is essential to ensure that when you can no longer work, you will not be left out in the cold with no way to pay your bills. In deciding on how to plan for your retirement, there are different avenues to travel. However, what avenue is best for you depends on your needs and the right legal advice. The following are some avenues to consider in planning out your retirement plan.

Individual Retirement Arrangement Limited Liability Company

The individual retirement arrangement limited liability company structure offers you the ability to use your retirement funds to make almost any type of investment on your own without requiring consent of any custodian. The Individual Retirement Arrangement’s (IRA) owner establishes the IRA and organizes the limited liability company where the IRA’s owner is manager and control person over the limited liability company’s operations. This involves the IRA acquiring the limited liability company’s interests so that IRA is the sole member and the IRA owner is the manager. The IRA is overseen by a custodian similar to other IRAs, but the IRA owner can direct investments through the management of the limited liability company. However, the limited liability company is prohibited from making certain investments deemed “prohibited transactions” by the Internal Revenue Service, and there are also a number of tax issues.

Qualified Private Retirement Plans

Federal law prohibits judgment creditors from going after money in a pension plan that was set up under the Employee Retirement Income Security Act (ERISA). To be protected against creditors, your ERISA account must be either a qualified retirement plan or an employee welfare benefit plan covered by ERISA. To be considered “qualified” under ERISA or the Internal Revenue Code, a retirement plan must comply with ERISA’s or the Internal Revenue Code’s terms and administrative requirements. However, all retirement plan assets can be attached to collect alimony, child support, and federal taxes. Examples of ERISA-qualified pension plans and benefit plans covered by ERISA include:

  • 401(K) accounts;
  • pension and profit-sharing plans;
  • group health and life insurance plans;
  • dental and vision plans; and
  • HRAs, HSAs, and accidental death or disability benefits.

Individual Retirement Arrangements

Individual Retirement Arrangements (IRA) are established privately but are not considered ERISA-qualified. However, Federal bankruptcy law provides that IRA contributions and earnings up to $1,000,000 are exempt from creditor attachment. Additionally, rollover IRAs converted from qualified plans have no dollar limitation. Federal law also exempts education savings through education IRAs and 529 savings plans. If the savings were established more than two years prior to filing, the entire amount is exempt, but if the savings were established between 365 and 730 days before filing, the exemption is limited to $5,000.


An annuity is a fund from which equal periodic (usually monthly) amounts of money are distributed to the purchaser. Many states, including Texas, place annuities beyond the reach of creditors, but state laws vary widely across the country. In most states, the exemption for annuities is limited to a fixed dollar amount per month, although in some states the exemption can be unlimited. The exemption is generally for the purchase of commercial annuities.

What We Offer

The challenges of planning for your retirement can be extremely complicated, and the consequences for running afoul of numerous laws and rules, including federal and state tax laws, can be severe. Proper legal guidance is paramount.

Dodson Legal Group can provide you with the following services if you are looking to establish a retirement plan with one of the above methods:

  • Provide individualized and customized preliminary advice.
  • File all documents necessary to register your retirement plan entities.
  • Draft all governing documents for your retirement plans.
  • Provide you with a “How To” guide for maintaining your retirement plan.
  • Provide additional or ongoing support for a discounted hourly fee.

We hope that this material has provided you with valuable information, and if you are interested in setting up a retirement plan with one of the above methods, or are looking to expand your retirement plan, please schedule a consultation with one of our attorneys. You can contact our firm at:

Dodson Legal Group
14850 Montfort Dr., Ste. 165,
Dallas, TX 75254

Phone: 469-317-3330
Toll Free: 800-769-9249
Fax: 469-317-3331