Gov't 457(b) Plan - Alientation

[RTK]

I don't (fortunately or unfortunately) do a lot of work in the governmental 457 plan area, so I am hoping someone can point me in the right direction.

Question: Does the 457(g) requirement that assets be held in trust for the exclusive benefit of participants require that the 457 plan provide that the plan benefits are not subject to assignment and alientation (similar to that required by 401(a)(13) for 401(a) plans)?

An attempt is being made to attach a participant's account under the 457 plan to satisfy a state court tort judgment against the participant. The plan terms do not address this.

[Guest mjb]

See reg 1.457-8(a) which provides that assets are to be held in trust for the exclusive benefit of participants pursuant to a written agreement that meets the requirement for a valid trust under state law. Trust/custodial agreement should contain language preventing attachment of participants benefits. State law may also protect retirement benefits from claims of creditors.

[Kirk Maldonado]

Similar to what MJB provided, Code Section 457(g)(1) states:

A plan maintained by [governmental entity] shall not be treated as an eligible deferred compensation plan unless all assets and income of the plan described in subsection (b)(6) are held in trust for the exclusive benefit of participants and their beneficiaries.

[RTK]

Thanks guys. Sort of what I thought, but big help to see your thoughts before I go running amok.