PUBLIC LAW 109–8—APR. 20, 2005
119 STAT. 63
(i) in subparagraph (A), by striking ‘‘and’’ at the end; (ii) in subparagraph (B), by striking the period at the end and inserting ‘‘; and’’; (iii) by adding at the end the following: ‘‘(C) retirement funds to the extent that those funds are in a fund or account that is exempt from taxation under section 401, 403, 408, 408A, 414, 457, or 501(a) of the Internal Revenue Code of 1986.’’; and (iv) by striking ‘‘(2)(A) any property’’ and inserting: ‘‘(3) Property listed in this paragraph is— ‘‘(A) any property’’; (B) by striking paragraph (1) and inserting: ‘‘(2) Property listed in this paragraph is property that is specified under subsection (d), unless the State law that is applicable to the debtor under paragraph (3)(A) specifically does not so authorize.’’; (C) by striking ‘‘(b) Notwithstanding’’ and inserting ‘‘(b)(1) Notwithstanding’’; (D) by striking ‘‘paragraph (2)’’ each place it appears and inserting ‘‘paragraph (3)’’; (E) by striking ‘‘paragraph (1)’’ each place it appears and inserting ‘‘paragraph (2)’’; (F) by striking ‘‘Such property is—’’; and (G) by adding at the end the following: ‘‘(4) For purposes of paragraph (3)(C) and subsection (d)(12), the following shall apply: ‘‘(A) If the retirement funds are in a retirement fund that has received a favorable determination under section 7805 of the Internal Revenue Code of 1986, and that determination is in effect as of the date of the filing of the petition in a case under this title, those funds shall be presumed to be exempt from the estate. ‘‘(B) If the retirement funds are in a retirement fund that has not received a favorable determination under such section 7805, those funds are exempt from the estate if the debtor demonstrates that— ‘‘(i) no prior determination to the contrary has been made by a court or the Internal Revenue Service; and ‘‘(ii)(I) the retirement fund is in substantial compliance with the applicable requirements of the Internal Revenue Code of 1986; or ‘‘(II) the retirement fund fails to be in substantial compliance with the applicable requirements of the Internal Revenue Code of 1986 and the debtor is not materially responsible for that failure. ‘‘(C) A direct transfer of retirement funds from 1 fund or account that is exempt from taxation under section 401, 403, 408, 408A, 414, 457, or 501(a) of the Internal Revenue Code of 1986, under section 401(a)(31) of the Internal Revenue Code of 1986, or otherwise, shall not cease to qualify for exemption under paragraph (3)(C) or subsection (d)(12) by reason of such direct transfer. ‘‘(D)(i) Any distribution that qualifies as an eligible rollover distribution within the meaning of section 402(c) of the Internal Revenue Code of 1986 or that is described in clause (ii) shall
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