FINAL BILL REPORT

SSB 6393

                              C 237 L 90

BYSenate Committee on Law & Justice (originally sponsored by Senators Nelson, Talmadge and Newhouse)

Exempting certain retirement benefits from execution, attachment, garnishment, or seizure.

Senate Committee on Law & Justice

House Committe on Judiciary

SYNOPSIS AS ENACTED

BACKGROUND:

In 1987, the Legislature exempted retirement benefits, such as IRAs, Keoghs, and annuities, from legal attachment or seizure, both inside and outside bankruptcy.  In 1988, the United States Supreme Court held that a similar exemption in a Georgia statute was preempted by the Employee Retirement Income Security Act of 1974 (ERISA) due to its express reference to ERISA.

SUMMARY:

Express references to ERISA are eliminated and references are added regarding the state's authority, under the federal bankruptcy code, to enact exemptions from bankruptcy.  All retirement plans (whether subject to ERISA or not) are exempt from execution, attachment, garnishment or seizure.  To accord additional protection, qualified employee benefit plans are deemed spendthrift trusts which exclude benefits from an individual's estate.

Technical corrections clarify that employee benefit plans are liable for their own validly incurred obligations (such as trustee's fees) and that welfare benefit plans are not exempt.

VOTES ON FINAL PASSAGE:

     Senate   44    0

     House 97  0

EFFECTIVE:March 28, 1990