Senator Curtis S. Bramble proposes the following substitute bill:




Chief Sponsor: Keven J. Stratton

Senate Sponsor: Curtis S. Bramble


8     General Description:
9          This bill modifies provisions related to exemptions.
10     Highlighted Provisions:
11          This bill:
12          ▸     addresses the value of a homestead exemption;
13          ▸     includes certain savings plans; and
14          ▸     makes technical changes.
15     Money Appropriated in this Bill:
16          None
17     Other Special Clauses:
18          None
19     Utah Code Sections Affected:
20     AMENDS:
21          78B-5-503, as last amended by Laws of Utah 2013, Chapter 192
22          78B-5-505, as last amended by Laws of Utah 2016, Chapter 262

24     Be it enacted by the Legislature of the state of Utah:
25          Section 1. Section 78B-5-503 is amended to read:

26          78B-5-503. Homestead exemption -- Definitions -- Excepted obligations -- Water
27     rights and interests -- Conveyance -- Sale and disposition -- Property right for federal tax
28     purposes.
29          (1) For purposes of this section:
30          (a) "Household" means a group of persons related by blood or marriage living together
31     in the same dwelling as an economic unit, sharing furnishings, facilities, accommodations, and
32     expenses.
33          (b) "Mobile home" [is as] means the same as that term is defined in Section 57-16-3.
34          (c) "Primary personal residence" means a dwelling or mobile home, and the land
35     surrounding it, not exceeding one acre, as is reasonably necessary for the use of the dwelling or
36     mobile home, in which the individual and the individual's household reside.
37          (d) "Property" means:
38          (i) a primary personal residence;
39          (ii) real property; or
40          (iii) an equitable interest in real property awarded to a person in a divorce decree by a
41     court.
42          (2) (a) An individual is entitled to a homestead exemption consisting of property in this
43     state in an amount not exceeding:
44          (i) $5,000 in value if the property consists in whole or in part of property [which] that
45     is not the primary personal residence of the individual; or
46          (ii) [$30,000] $42,000 in value if the property claimed is the primary personal residence
47     of the individual.
48          (b) If the property claimed as exempt is jointly owned, each joint owner is entitled to a
49     homestead exemption[; however], except that:
50          (i) for property exempt under Subsection (2)(a)(i), the maximum exemption may not
51     exceed $10,000 per household; or
52          (ii) for property exempt under Subsection (2)(a)(ii), the maximum exemption may not
53     exceed [$60,000] $84,000 per household.
54          (c) A person may claim a homestead exemption in either or both of the following:
55          (i) one or more parcels of real property together with appurtenances and improvements;
56     or

57          (ii) a mobile home in which the claimant resides.
58          (d) A person may not claim a homestead exemption for property that the person
59     acquired as a result of criminal activity.
60          (e) (i) As used in this Subsection (2)(e):
61          (A) "Average index number" means the average of the 12 most recent Consumer Price
62     Index numbers that are available in December in the year previous to the calendar year that is
63     calculated in Subsection (2)(e)(iii).
64          (B) "Consumer Price Index number" means a monthly number for the unadjusted
65     Consumer Price Index for All Urban Consumers for all items as published each month by the
66     Bureau of Labor Statistics of the United States Department of Labor.
67          (ii) The dollar amounts in Subsections (2)(a) and (b) are for May 14, 2019, through
68     December 31, 2019.
69          (iii) For the calendar year 2020 and a calendar year after the calendar year 2020, the
70     state auditor shall:
71          (A) calculate new dollar amounts for each dollar amount in Subsection (2)(a) and (b)
72     by multiplying the dollar amount in Subsections (2)(a) and (b) by the average index number,
73     dividing the result by 251, and rounding to the nearest 100 dollars; and
74          (B) publish on the Office of the State Auditor website the new dollar amounts
75     calculated under Subsection (2)(e)(iii) no later than January 1 of the applicable calendar year.
76          (3) A homestead is exempt from judicial lien and from levy, execution, or forced sale
77     except for:
78          (a) statutory liens for property taxes and assessments on the property;
79          (b) security interests in the property and judicial liens for debts created for the purchase
80     price of the property;
81          (c) judicial liens obtained on debts created by failure to provide support or maintenance
82     for dependent children; and
83          (d) consensual liens obtained on debts created by mutual contract.
84          (4) (a) Except as provided in Subsection (4)(b), water rights and interests, either in the
85     form of corporate stock or otherwise, owned by the homestead claimant are exempt from
86     execution to the extent that those rights and interests are necessarily employed in supplying
87     water to the homestead for domestic and irrigating purposes.

88          (b) Those water rights and interests are not exempt from calls or assessments and sale
89     by the corporations issuing the stock.
90          (5) (a) When a homestead is conveyed by the owner of the property, the conveyance
91     may not subject the property to any lien to which [it] the property would not be subject in the
92     hands of the owner.
93          (b) The proceeds of any sale, to the amount of the exemption existing at the time of
94     sale, is exempt from levy, execution, or other process for one year after the receipt of the
95     proceeds by the person entitled to the exemption.
96          (6) The sale and disposition of one homestead does not prevent the selection or
97     purchase of another.
98          (7) For purposes of any claim or action for taxes brought by the United States Internal
99     Revenue Service, a homestead exemption claimed on real property in this state is considered to
100     be a property right.
101          Section 2. Section 78B-5-505 is amended to read:
102          78B-5-505. Property exempt from execution.
103          (1) (a) An individual is entitled to exemption of the following property:
104          (i) a burial plot for the individual and the individual's family;
105          (ii) health aids reasonably necessary to enable the individual or a dependent to work or
106     sustain health;
107          (iii) benefits the individual or the individual's dependent have received or are entitled
108     to receive from any source because of:
109          (A) disability;
110          (B) illness; or
111          (C) unemployment;
112          (iv) benefits paid or payable for medical, surgical, or hospital care to the extent they are
113     used by an individual or the individual's dependent to pay for that care;
114          (v) veterans benefits;
115          (vi) money or property received, and rights to receive money or property for child
116     support;
117          (vii) money or property received, and rights to receive money or property for alimony
118     or separate maintenance, to the extent reasonably necessary for the support of the individual

119     and the individual's dependents;
120          (viii) (A) one:
121          (I) clothes washer and dryer;
122          (II) refrigerator;
123          (III) freezer;
124          (IV) stove;
125          (V) microwave oven; and
126          (VI) sewing machine;
127          (B) all carpets in use;
128          (C) provisions sufficient for 12 months actually provided for individual or family use;
129          (D) all wearing apparel of every individual and dependent, not including jewelry or
130     furs; and
131          (E) all beds and bedding for every individual or dependent;
132          (ix) except for works of art held by the debtor as part of a trade or business, works of
133     art:
134          (A) depicting the debtor or the debtor and [his] the debtor's resident family; or
135          (B) produced by the debtor or the debtor and [his] the debtor's resident family;
136          (x) proceeds of insurance, a judgment, or a settlement, or other rights accruing as a
137     result of bodily injury of the individual or of the wrongful death or bodily injury of another
138     individual of whom the individual was or is a dependent to the extent that those proceeds are
139     compensatory;
140          (xi) the proceeds or benefits of any life insurance contracts or policies paid or payable
141     to the debtor or any trust of which the debtor is a beneficiary upon the death of the spouse or
142     children of the debtor, provided that the contract or policy has been owned by the debtor for a
143     continuous unexpired period of one year;
144          (xii) the proceeds or benefits of any life insurance contracts or policies paid or payable
145     to the spouse or children of the debtor or any trust of which the spouse or children are
146     beneficiaries upon the death of the debtor, provided that the contract or policy has been in
147     existence for a continuous unexpired period of one year;
148          (xiii) proceeds and avails of any unmatured life insurance contracts owned by the
149     debtor or any revocable grantor trust created by the debtor, excluding any payments made on

150     the contract during the one year immediately preceding a creditor's levy or execution;
151          (xiv) except as provided in Subsection (1)(b), any money or other assets held for or
152     payable to the individual as a participant or beneficiary from or an interest of the individual as
153     a participant or beneficiary in a retirement plan or arrangement that is described in Section
154     401(a), 401(h), 401(k), 403(a), 403(b), 408, 408A, 409, 414(d), 414(e), or 457, Internal
155     Revenue Code;
156          (xv) the interest of or any money or other assets payable to an alternate payee under a
157     qualified domestic relations order as those terms are defined in Section 414(p), Internal
158     Revenue Code;
159          (xvi) unpaid earnings of the household of the filing individual due as of the date of the
160     filing of a bankruptcy petition in the amount of 1/24 of the Utah State annual median family
161     income for the household size of the filing individual as determined by the Utah State Annual
162     Median Family Income reported by the United States Census Bureau and as adjusted based
163     upon the Consumer Price Index for All Urban Consumers for an individual whose unpaid
164     earnings are paid more often than once a month or, if unpaid earnings are not paid more often
165     than once a month, then in the amount of 1/12 of the Utah State annual median family income
166     for the household size of the individual as determined by the Utah State Annual Median Family
167     Income reported by the United States Census Bureau and as adjusted based upon the Consumer
168     Price Index for All Urban Consumers; [and]
169          (xvii) except for curio or relic firearms, as defined in Section 76-10-501, any three of
170     the following:
171          (A) one handgun and ammunition for the handgun not exceeding 1,000 rounds;
172          (B) one shotgun and ammunition for the shotgun not exceeding 1,000 rounds; and
173          (C) one shoulder arm and ammunition for the shoulder arm not exceeding 1,000
174     rounds[.]; and
175          (xviii) money, not exceeding $200,000, in the aggregate, that an individual deposits,
176     more than 18 months before the day on which the individual files a petition for bankruptcy or
177     an action is filed by a creditor against the individual, as applicable, in all tax-advantaged
178     accounts for saving for higher education costs on behalf of a particular individual that meets
179     the requirements of Section 529, Internal Revenue Code.
180          (b) The exemption granted by Subsection (1)(a)(xiv) does not apply to:

181          (i) an alternate payee under a qualified domestic relations order, as those terms are
182     defined in Section 414(p), Internal Revenue Code; or
183          (ii) amounts contributed or benefits accrued by or on behalf of a debtor within one year
184     before the debtor files for bankruptcy[. This may not include], except amounts directly rolled
185     over from other funds [which] that are exempt from attachment under this section.
186          (2) The exemptions in Subsections (1)(a)(xi), (xii), and (xiii) do not apply to proceeds
187     and avails of any matured or unmatured life insurance contract assigned or pledged as collateral
188     for repayment of a loan or other legal obligation.
189          (3) Disability benefits, as described in Subsection (1)(a)(iii)(A), and veterans benefits,
190     as described in Subsection (1)(a)(v), may be garnished on behalf of a child victim if the person
191     receiving the benefits has been convicted of a felony sex offense against a child and ordered by
192     the convicting court to pay restitution to the victim. The exemption from execution under this
193     section shall be reinstated upon payment of the restitution in full.
194          (4) Exemptions under this section do not limit items that may be claimed as exempt
195     under Section 78B-5-506.