Illinois Compiled Statutes 40 ILCS 5/11-223 – Annuities, etc., exempt
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(a) All annuities, refunds, pensions, and disability benefits granted under this Article shall be exempt from attachment or garnishment process and shall not be seized, taken, subjected to, detained, or levied upon by virtue of any judgment, or any process or proceeding whatsoever issued out of or by any court in this State, for the payment and satisfaction in whole or in part of any debt, damage, claim, demand, or judgment against any annuitant, participant, refund applicant, or other beneficiary hereunder.
No annuitant, refund applicant, or other beneficiary may transfer or assign his annuity, refund, or disability benefit or any part thereof by way of mortgage or otherwise, except as provided in Section 11-223.1, and except in the case of refunds, when a participant has pledged by assignment, power of attorney, or otherwise, as security for a loan from a legally operating credit union making loans only to participants in certain public employee pension funds described in the Illinois Pension Code, all or part of any refund which may become payable to him in the event of his separation from service. The board in its discretion may, however, pay to the wife or to the unmarried child under 18 years of age of any annuitant, refund applicant, or disability beneficiary, such an amount out of her husband’s annuity refund, or disability benefit as any court may order, or such an amount as the board may consider necessary for the support of his wife or children or both in the event of his disappearance or unexplained absence or of his failure to support such wife or children.
(b) The board may retain out of any future annuity, refund, or disability benefit payments such amount or amounts as it may require for the repayment of any moneys paid to any annuitant, pensioner, refund applicant, or disability beneficiary through misrepresentation, fraud or error. Any such action of the board shall relieve and release the board and the fund from any liability for any moneys so withheld.
(c) Whenever an annuity or disability benefit is payable to a minor or to a person certified by a medical doctor to be under legal disability, the board, in its discretion and when it is in the best interest of the person concerned, may waive guardianship or conservatorship proceedings and pay the annuity or benefit to the person providing or caring for the minor or person under legal disability.
In the event that a person certified by a medical doctor to be under legal disability (i) has no spouse, blood relative, or other person providing or caring for him or her, (ii) has no guardian of his or her estate, and (iii) is confined to a Medicare approved, State certified nursing home or to a publicly owned and operated nursing home, hospital, or mental institution, the Board may pay any benefit due that person to the nursing home, hospital, or mental institution, to be used for the sole benefit of the person under legal disability.
Payment in accordance with this subsection to a person, nursing home, hospital, or mental institution for the benefit of a minor or person under legal disability shall be an absolute discharge of the Fund’s liability with respect to the amount so paid. Any person, nursing home, hospital, or mental institution accepting payment under this subsection shall notify the Fund of the death or any other relevant change in the status of the minor or person under legal disability.
(d) Whenever an annuitant, applicant for refund or disability beneficiary disappears and his whereabouts are unknown, and it cannot be ascertained that he is alive, there shall be paid to his wife or children or both such amount as will not be in excess of the amount payable to them in the event such annuitant, applicant for refund or disability beneficiary had died on the date of disappearance. If he returns, or upon satisfactory proof of his being alive, the amount theretofore paid to such beneficiaries shall be charged against any moneys payable to him under this Article as though such payment to such beneficiaries had been an allowance to them out of the moneys payable to the employee as an annuitant, applicant for refund or disability beneficiary.
No annuitant, refund applicant, or other beneficiary may transfer or assign his annuity, refund, or disability benefit or any part thereof by way of mortgage or otherwise, except as provided in Section 11-223.1, and except in the case of refunds, when a participant has pledged by assignment, power of attorney, or otherwise, as security for a loan from a legally operating credit union making loans only to participants in certain public employee pension funds described in the Illinois Pension Code, all or part of any refund which may become payable to him in the event of his separation from service. The board in its discretion may, however, pay to the wife or to the unmarried child under 18 years of age of any annuitant, refund applicant, or disability beneficiary, such an amount out of her husband’s annuity refund, or disability benefit as any court may order, or such an amount as the board may consider necessary for the support of his wife or children or both in the event of his disappearance or unexplained absence or of his failure to support such wife or children.
Terms Used In Illinois Compiled Statutes 40 ILCS 5/11-223
- Annuity: A periodic (usually annual) payment of a fixed sum of money for either the life of the recipient or for a fixed number of years. A series of payments under a contract from an insurance company, a trust company, or an individual. Annuity payments are made at regular intervals over a period of more than one full year.
- Attachment: A procedure by which a person's property is seized to pay judgments levied by the court.
- Beneficiary: A person who is entitled to receive the benefits or proceeds of a will, trust, insurance policy, retirement plan, annuity, or other contract. Source: OCC
- Fraud: Intentional deception resulting in injury to another.
- Garnishment: Generally, garnishment is a court proceeding in which a creditor asks a court to order a third party who owes money to the debtor or otherwise holds assets belonging to the debtor to turn over to the creditor any of the debtor
- Guardian: A person legally empowered and charged with the duty of taking care of and managing the property of another person who because of age, intellect, or health, is incapable of managing his (her) own affairs.
- Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
- Person under legal disability: means a person 18 years or older who (a) because of mental deterioration or physical incapacity is not fully able to manage his or her person or estate, or (b) is a person with mental illness or is a person with developmental disabilities and who because of his or her mental illness or developmental disability is not fully able to manage his or her person or estate, or (c) because of gambling, idleness, debauchery or excessive use of intoxicants or drugs, so spends or wastes his or her estate as to expose himself or herself or his or her family to want or suffering. See Illinois Compiled Statutes 5 ILCS 70/1.06
- Power of attorney: A written instrument which authorizes one person to act as another's agent or attorney. The power of attorney may be for a definite, specific act, or it may be general in nature. The terms of the written power of attorney may specify when it will expire. If not, the power of attorney usually expires when the person granting it dies. Source: OCC
- State: when applied to different parts of the United States, may be construed to include the District of Columbia and the several territories, and the words "United States" may be construed to include the said district and territories. See Illinois Compiled Statutes 5 ILCS 70/1.14
(b) The board may retain out of any future annuity, refund, or disability benefit payments such amount or amounts as it may require for the repayment of any moneys paid to any annuitant, pensioner, refund applicant, or disability beneficiary through misrepresentation, fraud or error. Any such action of the board shall relieve and release the board and the fund from any liability for any moneys so withheld.
(c) Whenever an annuity or disability benefit is payable to a minor or to a person certified by a medical doctor to be under legal disability, the board, in its discretion and when it is in the best interest of the person concerned, may waive guardianship or conservatorship proceedings and pay the annuity or benefit to the person providing or caring for the minor or person under legal disability.
In the event that a person certified by a medical doctor to be under legal disability (i) has no spouse, blood relative, or other person providing or caring for him or her, (ii) has no guardian of his or her estate, and (iii) is confined to a Medicare approved, State certified nursing home or to a publicly owned and operated nursing home, hospital, or mental institution, the Board may pay any benefit due that person to the nursing home, hospital, or mental institution, to be used for the sole benefit of the person under legal disability.
Payment in accordance with this subsection to a person, nursing home, hospital, or mental institution for the benefit of a minor or person under legal disability shall be an absolute discharge of the Fund’s liability with respect to the amount so paid. Any person, nursing home, hospital, or mental institution accepting payment under this subsection shall notify the Fund of the death or any other relevant change in the status of the minor or person under legal disability.
(d) Whenever an annuitant, applicant for refund or disability beneficiary disappears and his whereabouts are unknown, and it cannot be ascertained that he is alive, there shall be paid to his wife or children or both such amount as will not be in excess of the amount payable to them in the event such annuitant, applicant for refund or disability beneficiary had died on the date of disappearance. If he returns, or upon satisfactory proof of his being alive, the amount theretofore paid to such beneficiaries shall be charged against any moneys payable to him under this Article as though such payment to such beneficiaries had been an allowance to them out of the moneys payable to the employee as an annuitant, applicant for refund or disability beneficiary.