Committee advances amendment to allow child-support arrearage claims against retirement distributions

Senate Bill 237 was advanced by the Senate Judiciary Committee as amended to allow child-support claimants to seek a one-time lump-sum distribution from a parent's retirement plan upon a distributable event to pay arrearages, while preserving plan terms on whether distributions are authorized and noting that such distributions remain subject to tax and penalties when applicable.

The reviser's brief said the bill originally would have allowed use of pensions and retirement monies to sustain support obligations and to prevent downward modification of child support for lost income caused by criminal activity or voluntary underemployment. Work with KPERS and the reviser produced an amendment limiting the change to instances where a parent has accumulated an arrearage and permitting a single lump-sum distribution only when the plan terms allow such a distribution (a "distributable event"). The amendment also removed language that would have forced plans to make unauthorized distributions and clarified that early-withdrawal penalties and tax consequences remain applicable.

Committee members noted Department for Children and Families concerns about the incarceration exception and federal rules; DCF confirmed the amendment addressed their immediate concerns about the retirement-distribution mechanism, though DCF asked caution regarding prohibiting modifications for incarceration because of potential federal conflicts. The committee voted to report SB 237 favorably as amended.