CJS07 Posted January 21, 2013 Posted January 21, 2013 A terminated participant in one of the Plans I manage, recently received a 'Notice of Levy' from the State of Massachusetts. I didn't think States could levy Qualified Retirement Plans. Anyone have any experience with this? If this is allowed, are there any exceptions?
david rigby Posted January 21, 2013 Posted January 21, 2013 ERISA section 514 (29 USC 1114): http://www.law.cornell.edu/uscode/text/29/1144 I'm a retirement actuary. Nothing about my comments is intended or should be construed as investment, tax, legal or accounting advice. Occasionally, but not all the time, it might be reasonable to interpret my comments as actuarial or consulting advice.
PensionPro Posted January 21, 2013 Posted January 21, 2013 My understanding of ERISA's anti-alienation rules are that while IRS federal tax liens may attach ERISA pension plans, state tax liens may not. PensionPro, CPC, TGPC
ESOP Guy Posted January 21, 2013 Posted January 21, 2013 We might need more details. I know there have been discussion about child support levies I found this thread quickly. http://benefitslink.com/boards/index.php?/topic/50232-child-support-levy/
Mike Preston Posted January 21, 2013 Posted January 21, 2013 IT depends on the dollar amount involved and the willingness of the participant to go along with the levy. If the participant is eligible for a distribution from the plan, the levy is for less than 10% of the account balance and the participant indicates his or her willingness to go along with it, it shouldn't violate 401(a)(13). However, the plan has to have the optional provisions of 401(a)(13) and most plans don't.
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