California Code of Civil Procedure 704.115
CAPRP704115 CAPRP CAPRP704115
California Code of Civil Procedure § 704.115.
(a) As used in this section, “private retirement plan” means:
(1) Private retirement plans, including, but not limited to, union retirement plans.
(2) Profit-sharing plans designed and used for retirement purposes.
(3) Self-employed retirement plans and individual retirement annuities or accounts provided for in the Internal Revenue Code of 1986, as amended, including individual retirement accounts qualified under Section 408 or 408A of that code, to the extent the amounts held in the plans, annuities, or accounts do not exceed the maximum amounts exempt from federal income taxation under that code.
(b) All amounts held, controlled, or in process of distribution by a private retirement plan, for the payment of benefits as an annuity, pension, retirement allowance, disability payment, or death benefit from a private retirement plan are exempt.
(c) Notwithstanding subdivision (b), where an amount described in subdivision (b) becomes payable to a person and is sought to be applied to the satisfaction of a judgment for child, family, or spousal support against that person:
(1) Except as provided in paragraph (2), the amount is exempt only to the extent that the court determines under subdivision (c) of Section 703.070.
(2) If the amount sought to be applied to the satisfaction of the judgment is payable periodically, the amount payable is subject to an earnings assignment order for support as defined in Section 706.011 or any other applicable enforcement procedure, but the amount to be withheld pursuant to the assignment order or other procedure shall not exceed the amount permitted to be withheld on an earnings withholding order for support under Section 706.052.
(d) After payment, the amounts described in subdivision (b) and all contributions and interest thereon returned to any member of a private retirement plan are exempt.
(e) Notwithstanding subdivisions (b) and (d), except as provided in subdivision (f), the amounts described in paragraph (3) of subdivision (a) are exempt only to the extent necessary to provide for the support of the judgment debtor when the judgment debtor retires and for the support of the spouse and dependents of the judgment debtor, taking into account all resources that are likely to be available for the support of the judgment debtor when the judgment debtor retires. In determining the amount to be exempt under this subdivision, the court shall allow the judgment debtor such additional amount as is necessary to pay any federal and state income taxes payable as a result of the applying of an amount described in paragraph (3) of subdivision (a) to the satisfaction of the money judgment.
(f) Where the amounts described in paragraph (3) of subdivision (a) are payable periodically, the amount of the periodic payment that may be applied to the satisfaction of a money judgment is the amount that may be withheld from a like amount of earnings under Chapter 5 (commencing with Section 706.010) (Wage Garnishment Law). To the extent a lump-sum distribution from an individual retirement account is treated differently from a periodic distribution under this subdivision, any lump-sum distribution from an account qualified under Section 408A of the Internal Revenue Code shall be treated the same as a lump-sum distribution from an account qualified under Section 408 of the Internal Revenue Code for purposes of determining whether any of that payment may be applied to the satisfaction of a money judgment.
Legislative History of CCP § 704.115
(Added by Stats.1982, c. 1364, p. 5159, § 2, operative July 1, 1983. Amended by Stats.1992, c. 163 (A.B.2641), § 42, operative Jan. 1, 1994; Stats.1999, c. 98 (S.B.469), § 2; Stats.2000, c. 135 (A.B.2539), § 16.)
LAW REVISION COMMISSION COMMENTS to 1992 Amendment
Subdivision (c) of Section 704.115 is amended to conform to the terminology of the Family Code. See Chapter 8 (commencing with Section 5200) of Part 5 of Division 9 of the Family Code (earnings assignment order for support). A reference to “family” support has been added to subdivision (c). See Fam. Code § 4501 (family support order enforceable in same manner and to same extent as child support order). See also Section 680.145 (“child support” includes family support). [22 Cal.L.Rev.Comm.Reports 1 (1992)].
LEGISLATIVE COMMITTEE COMMENTS--ASSEMBLY to 1982 Addition
Section 704.115 supersedes subdivision (d) of former Section 690.18.
Subdivision (c) governs the application of the exemption for payable but unpaid benefits against enforcement of child or spousal support. Subdivision (c) (1) applies the general rule governing exemptions in support cases. Subdivision (c) (2) recognizes that federal law requires the protection of periodic payments pursuant to a pension or retirement program to the same extent as wages. See Section 706.052 and the Comment thereto.
The exemption provided in subdivision (d) applies whether money received by the judgment debtor is in the actual possession of the recipient or has been deposited. See Section 703.080 (tracing exempt funds). The general rule governing exemptions in support cases provided by Section 703.070 applies to benefits after they have been paid.
Subdivisions (e) and (f) are new.
Subdivision (e) requires that the court consider all resources--such as social security payments and other income assets--that are likely to be available to the judgment debtor when the judgment debtor retires. Accordingly, where it will be a number of years before the judgment debtor will retire, the court will take into account not only all the assets of the judgment debtor at the time the exemption claim is determined but also all the assets and income (including pension rights) that the judgment debtor is likely to acquire prior to retirement.
Subdivision (f) recognizes that the federal law requires the protection of periodic payments pursuant to a retirement program. See 15 U.S.C. §§ 1672(a), 1673(a). [16 Cal.L.Rev.Comm. Reports 1413 (1982) ].
California Private Retirement Plan Topics And Opinions
California Private Retirement Plan Topics And Opinions -- All Pages
- California Private Retirement Plan Defects
- Gluck v. Sarkissian, 2021 WL 5407188 (Cal.App., 2nd Distr., Unpublished, Nov. 19, 2021).
- In re Barnes, 275 B.R. 889 (Bk.E.D.Cal., 2002).
- In re Beverly, 374 B.R. 221 (9th Cir., B.A.P., 2011).
- In re Bloom, 839 F.2d 1376 (9th Cir., 1988).
- In re Chen, 2011 WL 2358653 (Bk.N.D.Cal., 2011).
- In re Crosby, 162 B.R. 276 (Bk.C.D.Cal., 1993).
- In re Daniel, 771 F.2d 1352 (9th Cir., 1985).
- In re Davis, 323 B.R. 732 (BAP 9th Cir., 2005).
- In re Friedman, 220 B.R. 670 (9th Cir.B.A.P., 1998).
- In re Lieberman, 245 F.3d 1090 (9th Cir., 2001).
- In re Phillips, 206 B.R. 196 (Bk.N.D.Cal., 1997).
- In re Rucker, 570 F.3d 1155 (9th Cir., 2009).
- In re Segovia, 404 B.R. 896 (2009).
- In re Simpson, 557 F.3d 1010 (2009).
- In re Stern, 345 F.3d 1036 (9th Cir., 2003).
- In re Switzer, 146 B.R. 1 (Bk.C.D.Cal., 1992).
- Marriage of La Moure, 221 Cal.App.4th 1463, 15 Cal.Rptr. 3d 417 (2013).
- McMullen v. Haycock, 147 Cal.App.4th 753, 54 Cal.Rptr. 3d 660 (2007).
- O'Brien v AMBS Diagnostics, LLC, 38 Cal.App.5th 553, 251 Cal.Rptr.3d 41 (Aug. 8, 2019).
- Post-Distribution Exemption-Tracing Issues of California Private Retirement Plan
- Salameh v. Tarsadia Hotel, 2015 WL 6028927 (S.D.Cal., 2015).
- Schwartzman v. Wilshinsky, 50 Cal.App.4th 619, 57 Cal.Rptr.2d 790 (1996).
- Tax and ERISA Issues of California Private Retirement Plans
- Voidable Transactions And California Private Retirement Plans
- Yaesu Electronics Corp. v. Tamura, 28 Cal.App.4th 8, 33 Cal.Rptr.2d 283 (1994).