Report Title:

Pensions; Bankruptcy

 

Description:

Protects 401(k) pension plans and 408A Roth IRA accounts from attachment, execution, seizure, and operation of bankruptcy laws. (HB1697 HD1)

 

HOUSE OF REPRESENTATIVES

H.B. NO.

1697

TWENTY-FIRST LEGISLATURE, 2002

H.D. 1

STATE OF HAWAII

 
   

A BILL FOR AN ACT

 

RELATING TO PENSION PLANS.

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

SECTION 1. Section 651-124, Hawaii Revised Statutes, is amended to read as follows:

"[[]651-124[]] Pension money exempt. The right of a debtor to a pension, annuity, retirement or disability allowance, death benefit, any optional benefit, or any other right accrued or accruing under any retirement plan or arrangement described in section 401(a), 401(k), 403(a), 403(b), 408, 408A, 409 (as in effect prior to January 1, 1984), 414(d), or 414(e) of the Internal Revenue Code of [1954,] 1986, as amended, or any fund created by the plan or arrangement, shall be exempt from attachment, execution, seizure, the operation of bankruptcy or insolvency laws under 11 United States Code section 522(b), or under any legal process whatever. However, this section shall not apply to (1) a "qualified domestic relations order" as defined in section 206(d) of the Employee Retirement Security Act of 1974, as amended, or in section 414(p) of the Internal Revenue Code of [1954,] 1986, as amended, and (2) contributions made to a plan or arrangement within the three years before the date a debtor files for bankruptcy, whether voluntary or involuntary, or within three years before the date a civil action is initiated against the debtor, except for contributions to a retirement plan established by state statute if the effect would be to eliminate a state employee's retirement service credit."

SECTION 2. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 3. This Act shall take effect upon its approval.