Case Summary:
Debtor, who had previously been denied a discharge, sought to exempt approximately $450,000.00 held in a pension plan.  The trustee objected to the exemption, contending that the plan was not compliant with either ERISA or the Internal Revenue Code.  The court found that the insubstantial presence of one other employee as a participant in the plan did not render it ERISA-qualified; ERISA excludes plans which benefit only sole shareholders such as the debtor, and this was therefore a “plan without employees” and not covered by ERISA.  Similarly, the failure to maintain or update the plan to conform with the tax laws meant that the plan was not “IRS-qualified.”  Accordingly, the debtor’s exemption claim was denied.

Statue/Rule References:
11 U.S.C. § 522(d) -- Exemptions - Federal
11 U.S.C. § 541 -- Property of the Estate

Key Terms:
Exemptions
Property of the Estate