CCP 704.115: Full vs Partial Protection and Support Exceptions

The CCP 704.115 retirement plan exemption shields most California retirement savings from judgment creditors, but how much it shields depends entirely on what kind of account holds your money. Private employer plans, union plans, and qualifying profit-sharing plans are fully exempt. IRAs, Roth IRAs, SEPs, self-employed plans, 403(b) accounts, and 457 deferred compensation accounts get a narrower exemption limited to what you need for retirement support, with a statutory floor of $1,711,975 for personal debts.¹

Which Accounts Get Full Protection

Subdivision (b) of the statute protects the entire balance of a private employer or union retirement plan, along with qualifying profit-sharing plans. The protection covers money held by the plan, money in the process of being distributed, and amounts payable as a pension, annuity, retirement allowance, disability benefit, or death benefit. Account size, your income, and your other assets don’t matter. The exemption is absolute against ordinary judgment creditors.¹

Profit-sharing plans carry one condition. The plan must be designed and actually used for retirement purposes. Courts look at how the plan operates in practice, not just at the plan documents. Regular borrowing against the plan or frequent early withdrawals for non-retirement spending can push a court to deny the full exemption on the ground that the plan is functioning as something other than a retirement vehicle.²

Which Accounts Get Only Partial Protection

Accounts under subdivisions (a)(3) and (a)(4) are treated differently. These include:

Traditional IRAs and Roth IRAs under IRC Sections 408 and 408A
SEP-IRAs and Keogh plans
Other self-employed retirement plans
403(b) tax-sheltered annuities for nonprofit employees
Certain church plans under Section 414
457 deferred compensation plans for government and nonprofit workers

For these accounts, subdivision (e) limits the exemption to the amount “necessary to provide for the support of the judgment debtor when the judgment debtor retires and for the support of the spouse and dependents of the judgment debtor.” The protection is also capped at the federally tax-exempt portion of each account, and only to the extent federal law doesn’t already protect the balance.¹

You carry the burden of showing the funds are necessary for support. A court won’t take that on faith.

How Courts Decide What’s “Necessary for Support”

The statute tells courts to consider “all resources that are likely to be available for the support of the judgment debtor when the judgment debtor retires.” In practice, judges weigh your current age, your health, your expected retirement date, projected Social Security income, other savings and pension income, your reasonable living expenses, and how much you can earn before retirement.

A 62-year-old with a modest IRA and no other savings will usually keep the full balance. A high-earning 40-year-old with a well-funded 401(k) and a large brokerage account may see much of an IRA opened up to creditors. Documentation drives the result: monthly expense breakdowns, medical cost projections, and evidence of other retirement resources all go into the record.

The $1,711,975 Floor for Personal Debts

AB 2837 added a hard floor to the necessary-for-support analysis. Under subdivision (e)(2), when the judgment is for personal debt, the exempt amount cannot be set below the figure in 11 U.S.C. § 522(n), adjusted for inflation. That figure is $1,711,975 as of April 1, 2025, aggregated across every retirement plan in your name.¹³

Before this change, a court could set the protected amount at any level it thought reasonable. Now, even if a judge concludes you have ample resources, you keep at least $1,711,975 across your IRAs and similar accounts when the creditor is enforcing a personal debt. For balances above the floor, the necessary-for-support test still controls. The floor does not apply to support obligations or business debts.

Support Obligations Can Reach Even Fully Protected Plans

The blanket protection for employer and union plans has one major exception. For judgments on child support, family support, or spousal support, subdivision (c) replaces the full exemption with the necessary-for-support standard of Section 703.070. Retirement funds that would be untouchable against a credit card company are reachable, within limits, for a support creditor.¹

For ongoing retirement payments, withholding for support is capped by CCP 706.052, which generally limits the take to 50% of disposable retirement income. A court can adjust the percentage downward based on the needs of everyone the debtor is required to support, but the ceiling cannot exceed the federal limit in 15 U.S.C. § 1673.⁴ When retirement assets are divided in a divorce or support case, the vehicle is usually a Qualified Domestic Relations Order, which directs the plan administrator to pay a portion of benefits to an alternate payee.⁵

Distributions Stay Protected, If You Can Trace Them

Money doesn’t lose its exempt status the moment it leaves the plan. Subdivision (d) continues the exemption for retirement distributions and for contributions and interest returned to a member.¹ Without that rule the exemption would be useless to anyone actually living on retirement income.

The practical issue is tracing. You have to be able to show that the dollars in your bank account came from a protected retirement source. Mixing retirement payments with paychecks, tax refunds, or other non-exempt deposits in the same account creates a problem. Courts generally apply the lowest intermediate balance rule: if the account dips below the amount of exempt funds you deposited, your protection drops to that lowest balance, and if the account ever hits zero, the exempt character is gone. Keeping a separate account that holds nothing but retirement distributions is the simplest way to preserve the exemption.

Claiming the Exemption

Protection isn’t automatic. When a creditor levies on your account, you have to file a claim of exemption with the levying officer. Under CCP 703.520, the deadline is 15 days from personal service of the notice of levy, or 20 days if the notice was mailed.⁶

The claim is signed under oath and should contain:

Your name and a mailing address where the creditor can serve any opposition
A description of the property you’re claiming as exempt
The statutory basis, citing CCP 704.115 and the subdivision that applies to your plan
Facts explaining why the exemption applies, including the type of account
A financial statement when the exemption depends on a necessity showing, as it does for IRAs and self-employed plans

Missing the deadline is costly. If you don’t file within the window, the levying officer can release your funds to the creditor. Subdivision (c) of CCP 703.520 permits a late filing for personal debts, but the officer isn’t required to hold the funds while you catch up.

How ERISA and Bankruptcy Fit In

If your account is an ERISA-qualified employer plan like a 401(k) or traditional pension, you also have a federal layer of protection. ERISA requires every covered pension plan to carry an anti-alienation provision barring assignment of benefits, and the Supreme Court held in Patterson v. Shumate that this provision excludes ERISA plan assets from the bankruptcy estate entirely.⁷⁸ For those accounts, CCP 704.115 is backup rather than primary protection. IRAs, Roth IRAs, and self-employed plans don’t get ERISA’s benefit and depend on state law.

California has also opted out of the federal bankruptcy exemption list. Under CCP 703.130, the exemptions in 11 U.S.C. § 522(d) aren’t available to California debtors; you must use a California scheme.⁹ Because the state floor is now tied to the same $1,711,975 figure as the federal IRA cap, the outcomes for personal debt often match up, but the analysis runs through CCP 704.115 instead of the federal list.

The Tax Hit If a Creditor Does Reach Your Account

If a creditor successfully reaches funds that aren’t fully exempt, the tax consequences land on you. The IRS treats distributions from qualified plans and IRAs as taxable income to the account holder regardless of who ends up with the cash. If you’re under 59½, a 10% early distribution penalty generally applies on top of the income tax.

Only one narrow exception helps, and it doesn’t help here: IRS levies themselves are exempt from the 10% penalty under IRC Section 72(t)(2)(A)(vii), but private creditor levies are not.¹⁰ A $50,000 seizure from a 52-year-old’s IRA means income tax on $50,000 plus a $5,000 penalty, even though the debtor never touched the money. Raising this at the exemption hearing is worthwhile, because the real cost of any seizure runs well above the face amount.

1
California Legislative Information. California Code of Civil Procedure 704.115
2
California Law Revision Commission. Memorandum 95-23 – Debtor-Creditor Relations: Retirement Account Exemption
3
Office of the Law Revision Counsel. 11 USC 522 – Exemptions
4
California Legislative Information. California Code of Civil Procedure CCP 706.052
5
U.S. Department of Labor. QDROs Under ERISA: A Practical Guide to Dividing Retirement Benefits
6
California Legislative Information. California Code of Civil Procedure 703.520
7
Office of the Law Revision Counsel. 29 USC 1056 – Required Plan Provisions: Assignment or Alienation of Plan Benefits
8
Justia U.S. Supreme Court. Patterson v. Shumate, 504 U.S. 753 (1992)
9
California Legislative Information. California Code of Civil Procedure 703.130
10
Internal Revenue Service. Retirement Topics – Exceptions to Tax on Early Distributions