Which assets are exempt from execution under CPLR §5205 and how have courts interpreted those exemptions?
Executive summary
CPLR §5205 enumerates a broad set of personal-property exemptions shielding certain retirement funds, portions of wages, trust income, specific personal effects and limited homestead value from execution to satisfy money judgments, subject to dollar caps and timing limits; courts have both broadly applied statutory text to protect retirement and direct-deposit benefits and narrowly limited exemptions where post‑claim transfers, voidable transactions, or lack of statutory fit appear (Justia/NY Senate statutory text; DFS guidance; case law dispute in bankruptcy) [1] [2] [3] [4]. The statute’s detailed subparts, administrative dollar adjustments and the 90‑day “additions” rule have produced litigation focusing on rollovers, payroll direct deposits and the interplay between state exemptions and bankruptcy law [1] [3] [5] [6].
1. What the statute lists: the headline exemptions
Subdivision (a) of CPLR §5205 catalogs the exempt personal property: retirement-related assets (IRAs, Keogh, employer plans and many occupational pensions), ninety percent of income from an exempt trust, household furniture and other basics, a restrained homestead cap (with county‑specific amounts), tools of the trade, social security and public benefits, and a set of specified personal effects and burial grounds — all “except such part as a court determines to be unnecessary for the reasonable requirements of the judgment debtor and his dependents” (text of CPLR §5205 as published on Justia and the NY Senate site) [1] [2] [7].
2. Dollars, direct deposit and periodic adjustments
CPLR §5205(l) mandates that certain exemption dollar amounts be adjusted and published periodically, and the Department of Financial Services issues the current dollar amounts that apply to statutory exemptions for banking-account protections and related sections; this administrative mechanism governs how much of statutorily exempt payments held in accounts may be retained from restraint or execution [3] [1].
3. Timing limits and the 90‑day additions rule
The statute contains an anti‑avoidance timing rule: “additions” to an otherwise exempt asset made within 90 days before a claim is interposed (or additions deemed voidable under the Debtor & Creditor Law) are not protected, a provision courts use to disregard last‑minute transfers intended to thwart creditors (CPLR §5205 text; multiple historic codifications) [1] [7].
4. How courts have read retirement and rollover protections
Courts have generally construed retirement exemptions broadly — treating employer pensions and IRAs as exempt when they fit the statutory categories — but litigation centers on whether a given plan or transfer qualifies. Bankruptcy and state courts have litigated whether CPLR §5205(c) automatically shields certain pension plans, and bankruptcy judges have wrestled with whether the statute alone resolves exemption disputes when federal bankruptcy law defers to state law; one Western District of New York bankruptcy opinion examined whether §5205(c) is dispositive and highlighted competing readings between debtors and trustees over plan characterization [4]. Practitioners report that rollovers from exempt accounts can preserve exemption, but deposits made within 90 days before a claim may be treated as non‑exempt additions [5] [7].
5. Wages and bank accounts — protections in practice
CPLR §5205(d) and related provisions protect earnings: jurisdictions and commentators note that 90% of wages deposited in the prior 60 days may be exempt from creditors, and the statute’s amendments and administrative rules address how exemptions apply to banking institution accounts receiving statutorily exempt payments [6] [1] [3]. Courts and counsel therefore pay close attention to how funds were earned and when they were deposited to determine whether a restraining notice can reach account balances.
6. Limits, litigation pressure points and differing perspectives
Despite broad language, exemptions are not unlimited: aggregate caps on certain personal property categories exist when state exemptions are elected (practical caps reported by practitioners), administrative dollar updates can shrink or expand protections over time, and courts will deny exemption when transfers are fraudulent, voidable, or untimely under the 90‑day rule (accessible-law summary; DFS; Justia statutory history) [8] [3] [1]. Advocates for debt collection emphasize that the anti‑avoidance rules and judicial discretion prevent abuse, while debtor advocates point to robust statutory protections for retirement and public benefits; the bankruptcy court disputes show the tension between maximizing creditor recovery and preserving statutory social‑safety exemptions [4] [8].
Exactly which asset a creditor may reach in any case depends on statutory text, the timing and source of funds, administrative dollar limits, and how courts classify a particular plan or transfer; where the sources reviewed are silent on a specific plan or fact pattern, further case‑specific research is required [1] [4] [3].