Present law provides that one of the benefits that must be exempt from execution, seizure, or attachment includes the debtor's right to receive, to the same extent that earnings are exempt pursuant to garnishment law, a payment under a stock bonus, pension, profitsharing, annuity, or similar plan or contract on account of death, age or length of service unless certain conditions are met under present law.
This bill clarifies that one of the benefits that must be exempt from execution, seizure, or attachment includes the debtor's right to receive the above-mentioned payments in circumstances where such payments are not exempted under state pension moneys or certain retirement plan funds or assets unless certain conditions are met under present law.
Present law provides that one of the benefits that must be exempt from execution, seizure, or attachment includes the debtor's right to receive, to the same extent that earnings are exempt pursuant to garnishment law, a payment under a stock bonus, pension, profitsharing, annuity, or similar plan or contract on account of death, age or length of service unless certain conditions are met including the assets of the fund or plan from which any such payments are made, or are to be made, are exempt only to the extent that the debtor has no right or option to receive them except as monthly or other periodic payments beginning at or after age 58. However, assets of such funds or plans are not exempt if the debtor may, at the debtor's option, accelerate payment so as to receive payment in a lump sum or in periodic payments over a period of 60 months or less.
This bill adds that assets of such funds or plans are not exempt if the debtor may, prior to age 58, accelerate payment so as to receive payment in a lump sum or in periodic payments over a period of 60 months or less.
This bill clarifies that this bill and present law do not remove the subpoena prohibition for plans qualified under §§ 401(a), 403(a), 403(b), 408, 408A, or 409 of the Internal Revenue Code. Additionally, this bill and present law do not make plan payments or assets of plans qualified under such sections of the Internal Revenue Code available to creditors unless otherwise available pursuant to the exemption exceptions regarding state pension moneys or certain retirement plan funds or assets.

Statutes affected:
Introduced: 26-2-111(1)(D), 26-2-111, 26-2-111(1)(D)(ii)