HBA-NMO H.B. 76(R)    BILL ANALYSIS


Office of House Bill AnalysisH.B. 76
By: Solomons
Financial Institutions
3/4/1999
Committee Report (Amended)



BACKGROUND AND PURPOSE 

Currently, traditional IRAs are protected from creditors in this state,
while Roth IRAs are not.   Roth IRAs were created by the Taxpayer Relief
Act of 1997.  Unlike a traditional IRA, an individual cannot deduct
contributions made to a Roth IRA from the individual's taxable income.
H.B. 76 exempts the Roth IRA from attachment, execution, or seizure by
creditor. 

RULEMAKING AUTHORITY

It is the opinion of the Office of House Bill Analysis that this bill does
not expressly delegate any additional rulemaking authority to a state
officer, department, agency, or institution. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Sections 42.0021(a) and (b), Property Code, to provide
that Section 408A, in addition to Section 403(b), Internal Revenue Code of
1986, describes a retirement annuity or account that is exempt from seizure
for the satisfaction of debts.  Makes conforming changes. 

SECTION 2.  Makes application of this Act prospective.

SECTION 3.  Emergency clause.
            Effective date:  upon passage.


EXPLANATION OF AMENDMENTS

Committee Amendment #1

SECTION 1.  Amends Section 42.0021(b), Property Code, to provide that
contributions to a Roth IRA described in Section 408A of the Internal
Revenue Code of 1986 are exempt under this section (Additional Exemption
for Retirement Plan).  Amends Section 42.0021(b), Property Code, to provide
that amounts treated as a qualified rollover contributions under Section
408A of the Internal Revenue Code of 1986 are treated as exempt amounts
under this section.