HB264 Summary

• Amends Section 19-3B-508 of the Alabama Code to expand the definition of "qualified trust" to include trusts formed as part of qualified pension plans, qualified stock bonus plans, and qualified profit sharing plans.

• Expands "qualified trust" definition to encompass retirement annuities, IRAs (including Roth IRAs), SEPs, SIMPLE IRAs, governmental plans, church plans, health savings accounts, and eligible deferred compensation plans under federal tax code sections.

• Provides that benefits under qualified trusts cannot be assigned or alienated and are exempt from federal bankruptcy and insolvency laws under 11 U.S.C. § 522(b).

• Establishes exceptions to assignment restrictions including qualified domestic relations orders, taxes owed to taxing authorities, excess contributions to qualified trusts, and criminal restitution orders.

• Exempts assets distributed from qualified trusts from assignment or alienation for at least 60 days after distribution if the distribution constitutes a qualified rollover contribution; protections cease upon account owner's death except for surviving spouses.

• Becomes effective on the first day of the third month following passage and approval by the Governor.