S.B. 50

1

PROPERTY EXEMPT FROM EXECUTION
2 2001 GENERAL SESSION
3 STATE OF UTAH
4 Sponsor: Carlene M. Walker
5 This act modifies the Judicial Code to include additional benefits and contracts as exempt
6 from judicial process. The act makes technical changes.
7 This act affects sections of Utah Code Annotated 1953 as follows:
8 AMENDS:
9 78-23-5, as last amended by Chapter 370, Laws of Utah 1999
10 78-23-9, as last amended by Chapter 13, Laws of Utah 1998
11 REPEALS:
12 78-23-6, as enacted by Chapter 111, Laws of Utah 1981
13 78-23-7, as enacted by Chapter 111, Laws of Utah 1981
14 Be it enacted by the Legislature of the state of Utah:
15 Section 1. Section 78-23-5 is amended to read:
16 78-23-5. Property exempt from execution.
17 (1) (a) An individual is entitled to exemption of the following property:
18 (i) a burial plot for the individual and [his] the individual's family;
19 (ii) health aids reasonably necessary to enable the individual or a dependent to work or
20 sustain health;
21 (iii) benefits the individual or [his] the individual's dependent have received or are entitled
22 to receive from any source because of:
23 (A) disability[,];
24 (B) illness[,]; or
25 (C) unemployment [from any source];
26 (iv) benefits paid or payable for medical, surgical, or hospital care to the extent they are
27 used by an individual or [his] the individual's dependent to pay for that care;

28 (v) veterans benefits;
29 (vi) money or property received, and rights to receive money or property for child support;
30 S [ (vii) money or property received, and rights to receive money or property for alimony or
31 separate maintenance; ] s
32 [(vii)] (viii) (A) one:
33 (I) clothes washer and dryer[, one];
34 (II) refrigerator[, one];
35 (III) freezer[, one];
36 (IV) stove[, one];
37 (V) microwave oven[, one]; and
38 (VI) sewing machine[,];
39 (B) all carpets in use[,];
40 (C) provisions sufficient for 12 months actually provided for individual or family use[,];
41 (D) all wearing apparel of every individual and dependent, not including jewelry or furs[,];
42 and
43 (E) all beds and bedding for every individual or dependent;
44 [(viii)] (ix) except works of art held by the debtor as part of a trade or business, works of
45 art:
46 (A) depicting:
47 (I) the debtor; or
48 (II) the debtor and [his] the debtor's resident family[,]; or
49 (B) produced by:
50 (I) the debtor; or
51 (II) the debtor and [his] the debtor's resident family[, except works of art held by the debtor
52 as part of a trade or business];
53 [(ix)] (x) proceeds of insurance, a judgment, or a settlement, or other rights accruing as
54 a result of bodily injury of the individual or of the wrongful death or bodily injury of another
55 individual of whom the individual was or is a dependent to the extent that those proceeds are
56 compensatory;
57 (xi) proceeds or benefits of life insurance contracts payable on the death of an insured, if
58 the individual was the spouse or a dependent of the insured;

59 (xii) proceeds and avails of any unmatured life insurance contracts owned by the
60 individual;
61 [(x)] (xiii) except as provided in Subsection (1)(b), any money or other assets held for or
62 payable to the individual as a participant or beneficiary from or an interest of the individual as a
63 participant or beneficiary in:
64 (A) a retirement plan or arrangement that is described in Section 401(a), 401(h), 401(k),
65 403(a), 403(b), 408, 408A, 409, 414(d), or 414(e) [of the United States], Internal Revenue Code
66 [of 1986, as amended]; [and]
67 (B) an annuity as defined in Section 31A-1-301 ; and
68 (C) any similar plan providing benefits other than by reason of illness or disability; and
69 [(xi)] (xiv) the interest of or any money or other assets payable to an alternate payee under
70 a qualified domestic relations order as those terms are defined in Section 414(p) [of the United
71 States], Internal Revenue Code [of 1986, as amended].
72 (b) The exemption granted by Subsection (1)(a)[(x)](xiii) does not apply to:
73 (i) an alternate payee under a qualified domestic relations order, as those terms are defined
74 in Section 414(p) [of the United States], Internal Revenue Code [of 1986, as amended]; or
75 (ii) amounts contributed or benefits accrued by or on behalf of a debtor within one year
76 before the debtor files for bankruptcy.
77 (2) Exemptions under this section do not limit items [which] that may be claimed as
78 exempt under Section 78-23-8 .
79 Section 2. Section 78-23-9 is amended to read:
80 78-23-9. Exemption of proceeds from property sold, taken by condemnation, lost,
81 damaged, or destroyed -- Tracing exempt property and proceeds.
82 (1) (a) [If] An individual who owned property described in this Subsection (1) is entitled
83 to an exemption of proceeds that are traceable for one year after the compensation for the property
84 is received if:
85 (i) (A) the property, or a part [thereof] of the property, [that] could have been claimed
86 exempt under Subsection 78-23-5 (1)(a)(i) or (ii)[,]; or
87 (B) the property is personal property subject to a value limitation under Subsection
88 78-23-8 (1)(a), (b), or (c); and
89 (ii) the property has been:

90 (A) sold or taken by condemnation[,]; or [has been]
91 (B) lost, damaged, or destroyed; and
92 (C) the owner has been compensated [therefor, the individual is entitled to an exemption
93 of proceeds that are traceable for one year after the proceeds are received] for the property.
94 (b) The exemption of proceeds under this Subsection (1) does not entitle the individual to
95 claim an aggregate exemption in excess of the value limitation otherwise allowable under Section
96 78-23-3 or 78-23-8 .
97 (2) Money or other property exempt under Subsection 78-23-5 (1)(a)(iii), (iv), (v), [or] (vi),
98 [or exempt to the extent reasonably necessary for support under Section 78-23-6 ,] (vii), (xii), or
99 (xiii)(B) or (C) remains exempt after its receipt by, and while it is in the possession of, the
100 individual or in any other form into which it is traceable.
101 (3) Money or other property and proceeds exempt under this chapter are traceable under
102 this section by application of:
103 (a) the principle of:
104 (i) first-in first-out[,];
105 (ii) last-in last-out[,]; or
106 (b) any other reasonable basis for tracing selected by the individual.
107 Section 3. Repealer.
108 This act repeals:
109 Section 78-23-6, Property exempt from execution to extent necessary for support.
110 Section 78-23-7, Exemption of unmatured life insurance contracts.




Legislative Review Note
as of 1-4-01 2:27 PM

A limited legal review of this legislation raises no obvious constitutional or statutory concerns.

Office of Legislative Research and General Counsel