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H.B. 121 Enrolled
This bill modifies the Judicial Code to include additional benefits and contracts as
exempt from judgment execution, and makes technical changes.
. adds the following to the list of property exempt from judgment execution:
. alimony and separate maintenance payments;
. life insurance benefits;
. proceeds of unmatured life insurance contracts owned by the individual, unless
pledged or used as collateral; and
. disability plan payments with specific criteria; and
. allows for the exemption of the traceable proceeds from the execution of a judgment
on any of the property listed above for one year under specific circumstances.
Monies Appropriated in this Bill:
Other Special Clauses:
Utah Code Sections Affected:
78-23-5, as last amended by Chapter 135, Laws of Utah 2004
78-23-9, as last amended by Chapter 13, Laws of Utah 1998
78-23-6, as enacted by Chapter 111, Laws of Utah 1981
78-23-7, as last amended by Chapter 38, Laws of Utah 2001
Be it enacted by the Legislature of the state of Utah:
Section 1. Section 78-23-5 is amended to read:
78-23-5. Property exempt from execution.
(1) (a) An individual is entitled to exemption of the following property:
(i) a burial plot for the individual and [
(ii) health aids reasonably necessary to enable the individual or a dependent to work or
(iii) benefits the individual or [
entitled to receive [
(B) illness; or
(iv) benefits paid or payable for medical, surgical, or hospital care to the extent they are
used by an individual or [
(v) veterans benefits;
(vi) money or property received, and rights to receive money or property for child
(vii) money or property received, and rights to receive money or property for alimony or
separate maintenance, to the extent reasonably necessary for the support of the individual and the
(I) clothes washer and dryer[
(V) microwave oven[
(VI) sewing machine[
(B) all carpets in use[
(C) provisions sufficient for 12 months actually provided for individual or family use[
(D) all wearing apparel of every individual and dependent, not including jewelry or
(E) all beds and bedding for every individual or dependent;
(ix) except for works of art held by the debtor as part of a trade or business, works of art:
(A) depicting the debtor or the debtor and his resident family[
(B) produced by the debtor or the debtor and his resident family[
result of bodily injury of the individual or of the wrongful death or bodily injury of another
individual of whom the individual was or is a dependent to the extent that those proceeds are
(xi) the proceeds or benefits of any life insurance contracts or policies paid or payable to
the debtor upon the death of the spouse or children of the debtor, provided that the contract or
policy has been owned by the debtor for a continuous unexpired period of one year;
(xii) the proceeds or benefits of any life insurance contracts or policies paid or payable to
the spouse or children of the debtor upon the death of the debtor, provided that the contract or
policy has been in existence for a continuous unexpired period of one year;
(xiii) proceeds and avails of any unmatured life insurance contracts owned by the debtor,
excluding any payments made on the contract during the one year immediately preceding a
creditor's levy or execution;
payable to the individual as a participant or beneficiary from or an interest of the individual as a
participant or beneficiary in a retirement plan or arrangement that is described in Section 401(a),
401(h), 401(k), 403(a), 403(b), 408, 408A, 409, 414(d), or 414(e) [
Revenue Code [
a qualified domestic relations order as those terms are defined in Section 414(p) [
(b) The exemption granted by Subsection (1)(a)[
(i) an alternate payee under a qualified domestic relations order, as those terms are
defined in Section 414(p) [
(ii) amounts contributed or benefits accrued by or on behalf of a debtor within one year
before the debtor files for bankruptcy. This may not include amounts directly rolled over from
other funds which are exempt from attachment under this section.
(2) The exemptions in Subsections (1)(a)(xi), (xii), and (xiii) do not apply to proceeds
and avails of any matured or unmatured life insurance contract assigned or pledged as collateral
for repayment of a loan or other legal obligation.
exempt under Section 78-23-8 .
Section 2. Section 78-23-9 is amended to read:
78-23-9. Exemption of proceeds from property sold, taken by condemnation, lost,
damaged, or destroyed -- Tracing exempt property and proceeds.
(1) (a) [
to an exemption of proceeds that are traceable for one year after the compensation for the
property is received if:
(i) (A) the property, or a part [
exempt under Subsection 78-23-5 (1)(a)(i) or (ii)[
(B) the property is personal property subject to a value limitation under Subsection
78-23-8 (1)(a), (b), or (c); and
(ii) the property has been:
(A) sold or taken by condemnation[
(B) lost, damaged, or destroyed; and
(C) the owner has been compensated [
(b) The exemption of proceeds under this Subsection (1) does not entitle the individual to
claim an aggregate exemption in excess of the value limitation otherwise allowable under
Section 78-23-3 or 78-23-8 .
(2) Money or other property exempt under Subsection 78-23-5 (1)(a)(iii), (iv), (v), [
(xiii), or (xiv) remains exempt after its receipt by, and while it is in the possession of, the
individual or in any other form into which it is traceable.
(3) Money or other property and proceeds exempt under this chapter are traceable under
this section by application of:
(a) the principle of:
(i) first-in first-out[
(ii) last-in last-out[
(b) any other reasonable basis for tracing selected by the individual.
Section 3. Repealer.
This bill repeals:
Section 78-23-6, Property exempt from execution to extent necessary for support.
Section 78-23-7, Exemption of unmatured life insurance contracts.
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