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Various Citations and Information From The Million Man March Group
The garnishment of retirement benefits is prohibited by the Social Security Act


"YIKES" <YIKES@JHRCIC.ORG>   Add to Address Book Add to Address Book




PASS IT ALONG - Federal & Military Retirees: GUIDRY v. SHEET METAL WORKERS, 493 US 365 (1990)


Thu, 5 May 2005 23:44:40 -0400

[ Footnote 13 ] The garnishment of retirement benefits is prohibited by the Social Security Act, 49 Stat. 620, as amended, 42 U.S.C. 407 (1982 ed.);  the Railroad Retirement Act, as amended, 47 Stat. 438, 45 U.S.C. 231m(a) (1982 ed., Supp. V);  the Civil Service Retirement Act, 5 U.S.C. 8346(a);  and the Veterans' Benefits Act, 38 U.S.C. 3101(a) (1982 ed.).




I know people who can use this decision IMMEDIATELY!

For example:

NOTE:  we could find NO PERTINENT CASES for IRC section 3405!


I especially like Footnote 13:

[ Footnote 13 ] The garnishment of retirement benefits is prohibited by the Social Security Act, 49 Stat. 620, as amended, 42 U.S.C. 407 (1982 ed.);  the Railroad Retirement Act, as amended, 47 Stat. 438, 45 U.S.C. 231m(a) (1982 ed., Supp. V);  the Civil Service Retirement Act, 5 U.S.C. 8346(a);  and the Veterans' Benefits Act, 38 U.S.C. 3101(a) (1982 ed.).


Sincerely yours,
/s/ Paul Andrew Mitchell, B.A., M.S.
Private Attorney General, Criminal Investigator and
Federal Witness:  18 U.S.C. 1510, 1512-13, 1964(a)

All Rights Reserved without Prejudice
copy:  SupremeLaw discussion list and message archive
"Ernest R. Brown" <rv-travelers@sbcglobal.net> wrote:


For your info



Footnote 1 ] Section 206(d)(1), 29 U.S.C. 1056(d)(1) (1982 ed.), of ERISA states: "Each pension plan shall provide that benefits provided under the plan may not be assigned or alienated."

[ Footnote 3 ] Section 501(c) provides: "Any person who embezzles, steals, or unlawfully and willfully abstracts or converts to his own use, or the use of another, any of the moneys, funds, securities, property, or other assets of a labor organization of which he is an officer, or by which he is employed, directly or indirectly, shall be fined not more than $10,000 or imprisoned for not more than five years, or both."

[ Footnote 5 ] The first claim alleged that Guidry had breached his fiduciary duty to the Union in violation of 501(a) of the LMRDA, 29 U.S.C. 501(a) (1982 ed.). App. 32-33. The second through fifth claims asserted state commonlaw claims under theories of conversion, fraud, equitable restitution, and negligence. Id., at 33-35. The sixth claim, asserted against petitioner and the three pension funds, did not set forth a substantive ground for relief. Rather, it asserted that the District Court "must restrain and enjoin the Pension Funds from paying any further pension benefits to Plaintiff Guidry until the completion of this action and thereafter until [the Union] is made whole for its losses." Id., at 35.

[ Footnote 7 ] The District Court cited Fremont v. McGraw-Edison Co., 606 F.2d 752 (CA7 1979), cert. denied, 445 U.S. 951 (1980); Winer v. Edison Brothers Stores Pension Plan, 593 F.2d 307 (CA8 1979); and Vink v. SHV North America Holding Corp., 549 F. Supp. 268 (SDNY 1982).

[ Footnote 10 ] Treasury Department regulations state that for tax purposes "a trust will not be qualified unless the plan of which the trust is a part provides that benefits provided under the plan may not be anticipated, assigned (either at law or in equity), alienated or subject to attachment, garnishment, levy, execution or other legal or equitable process." 26 CFR 1.401(a)-13(b)(1) (1989).

[ Footnote 11 ] The anti-alienation provision permits "any voluntary and revocable assignment of not to exceed 10 percent of any benefit payment." ERISA 206(d)(2), 29 U.S.C. 1056(d)(2) (1982 ed.). The Conference Report states: "For purposes of this rule, a garnishment or levy is not to be considered a voluntary assignment." H. R. Conf. Rep. No. 93-1280, p. 280 (1974).

[ Footnote 12 ] See, e. g., United Metal Products, supra; Ellis National Bank, supra; Tenneco Inc. v. First Virginia Bank of Tidewater, 698 F.2d 688, 689-690 (CA4 1983). Even courts that have recognized equitable exceptions to the bar on alienation have assumed that 206(d)(1) operates, as a general matter, to proscribe garnishment of pension benefits. See St. Paul Fire & Marine, 752 F.2d, at 551-552; Crawford, 259 U.S. App. D.C., at 283-284, 815 F.2d, at 121-122.

[ Footnote 13 ] The garnishment of retirement benefits is prohibited by the Social Security Act, 49 Stat. 620, as amended, 42 U.S.C. 407 (1982 ed.); the Railroad Retirement Act, as amended, 47 Stat. 438, 45 U.S.C. 231m(a) (1982 ed., Supp. V); the Civil Service Retirement Act, 5 U.S.C. 8346(a); and the Veterans' Benefits Act, 38 U.S.C. 3101(a) (1982 ed.).

[ Footnote 15 ] Section 501(c), 29 U.S.C. 501(c) (1982 ed.), under which petitioner was convicted, establishes criminal penalties for embezzlement or theft by a union officer or employee.

[ Footnote 16 ] Section 501(b), 29 U.S.C. 501(b) (1982 ed.), by its terms, does not establish a private right of action for a union itself. Rather, it provides that a suit may be brought in district court by a union member when a union officer is alleged to have breached his duties "and the labor organization or its governing board or officers refuse or fail to sue or recover damages or secure an accounting or other appropriate relief within a reasonable time after being requested to do so by any member of the labor organization." That language certainly contemplates that a union may bring suit against its officers in some forum, but it does not expressly provide an independent basis for federal jurisdiction. Courts have reached inconsistent positions on the question whether a union may bring suit under 501. Compare Building Material and Dump Truck Drivers, Local 420 v. Traweek, 867 F.2d 500, 506-507 (CA9 1989) (no right of action), with Brotherhood of Railway, Airline and Steamship Clerks, Freight Handlers, Express and Station Employees v. Orr, 95 LRRM 2701, 2702 (ED [493 U.S. 365, 375]   Tenn. 1977) (union has right of action to allege a violation of 501). We need not resolve that question here. Rather, we assume, without deciding, that a union may invoke the remedial provisions of 501(b).

Uncertainty as to the scope of 501(b) does not call into question the subject-matter jurisdiction of this Court or of the District Court and the Court of Appeals. This suit properly was brought by petitioner under 502 of ERISA to recover benefits allegedly due him under the pension plans. 29 U.S.C. 1132(a)(1)(B) and 1132(e) (1982 ed.).

[ Footnote 17 ] Indeed, the LMRDA has its own saving clause. Section 603(a), 29 U.S.C. 523(a) (1982 ed.), provides that "except as explicitly provided to the contrary, nothing in this Act shall take away any right or bar any remedy to which members of a labor organization are entitled under [any] other Federal law or law of any State." This provision weighs against respondents' contention that the LMRDA's authorization of "other appropriate relief" supersedes ERISA's express proscription of any alienation or assignment of pension benefits.

[ Footnote 18 ] See, for example, 104(a) of the Retirement Equity Act of 1984, 98 Stat. 1433, 29 U.S.C. 1056(d)(3) (1982 ed., Supp. V), where Congress mandated that the anti-alienation provision should not apply to a "qualified domestic relations order."

[ Footnote 19 ] In light of our disposition of petitioner's ERISA claim, we need not address his alternative claim under the Consumer Credit Protection Act. [493 U.S. 365, 378]  

--- In lawwork@yahoogroups.com, "Clyde" <candz@m...> wrote:

"We previously have declined to recognize any exceptions to ERISA's
anti-alienation provision outside the bankruptcy context."  See
Guidry v. Sheet Metal Workers Pension Fund, 493 U.S. 365 (1990)
"Moreover, these transfer restrictions are "enforceable," as
required by  541(c)(2).  Plan trustees or fiduciaries are required
under ERISA to discharge their duties "in accordance with the
documents and instruments governing the plan."  29 U.S.C.  1104(a)
(1)(D).  A plan participant, beneficiary, or fiduciary, or the
Secretary of Labor, may file a civil action to "enjoin any act or
practice" which violates ERISA or the terms of the plan.  29 U.S.C.
 1132(a)(3) and (5).  Indeed, this Court itself vigorously has
enforced ERISA's prohibition on the assignment or alienation of
pension benefits, declining to recognize any implied exceptions to
the broad statutory bar.  See Guidry v. Sheet Metal Workers Pension
Fund, 493 U.S. 365 (1990)."

" Our holding also gives full and appropriate effect to ERISA's goal
of protecting pension benefits.  See 29 U.S.C. 1001 (b) and (c). 
This Court has described that goal as one of ensuring that, " if a
worker has been promised a defined pension benefit upon retirement -
and if he has fulfilled whatever conditions are required to obtain a
vested benefit - he actually will receive it."  Nachman Corp. v.
Pension Benefit Guaranty Corporation, 446 U.S. 359, 375 (1980).  In
furtherance of these principals, we recently declined in Guidry,
notwithstanding strong equitable considerations to the contrary, to
recognize an implied exception to ERISA's antialienation provision
that would have allowed a labor union to impose a constructive trust
on the pension benefits of a corrupt union official. We
explained: "Section 206 (d) reflects a considered congressional
policy choice, a decision to safeguard a stream of income for
pensioners ( and their dependents, who may be, and usually are,
blameless ), even if that decision prevents others from securing
relief for the wrongs done them.  If exceptions to this policy are
to be made, it is for Congress to undertake that task" 493 U.S., at
376."  Patterson v. Shumate, 504 U.S. 753, 764 (1992) (Bankruptcy-

ERISA  2(a), 88 Stat. 832, 29 U.S.C.  1001(a).  Congress wanted to
correct this condition by making sure that, if a worker has been
promised a defined pension benefit upon retirement -- and if he has
fulfilled whatever conditions are required to obtain a vested
benefit -- he actually will receive it.  The termination insurance
program is a major part of Congress' response to the problem. 
Congress provided for a minimum funding schedule and prescribed
standards of conduct for plan administrators to make as certain as
possible that pension fund assets would be adequate...   Throughout
the entire legislative history, from the initial proposals to the
Conference Report, the legislators consistently described the class
of pension benefits to be insured as "vested benefits."  Petitioner
recognizes, as it must, that the terms "vested" and "nonforfeitable"
were used synonymously.  Nachman, Id.

Nachman, Id. protected the plan with insurance against bankruptcy of
the employer, protected against the bankruptcy of the employee in
Patterson, and against constructive trusts of criminal behavior in
Guidry.  The court has consistently said there are only two
exceptions those being 10% beneficiary voluntary assignment and for
child support and none other.  My contention is that if there was
another exception surely the court would have said there might be
other exceptions, but instead Congress and the Court both insist
that the vested interest lies with the beneficiary and not any other
entity or person.
The burden is on the corp. to show it can be alienated, so the
fiduciary duty would be to obtain declaratory judgment by suit in
federal courts on the issues of any garnishment.  Obviously a
conflict in law exists, an irreparable injury and a problem with the
IRS required or implied information reporting of retirement ERISA as
income.  If the committee thinks they, IRS or  circuit court can
judicially expand the provisions of ERISA, then surely the issue
needs to be put before the Supreme court.  Boggs v. Boggs, 520 U.S.
833 (1997) "ERISA's pension plan anti-alienation provision is
mandatory and contains only two explicit exceptions, see  1056(d)
(2), (d)(3)(A), which are not subject to judicial expansion."

Title I of ERISA,  2 et seq., 29 U.S.C.  1001 et seq., requires
administrators of all covered pension plans to file periodic reports
with the Secretary of Labor, mandates minimum participation, vesting
and funding schedules, establishes standards of fiduciary conduct
for plan administrators, and provides for civil and criminal
enforcement of the Act.  Please send a copy of that pertinent report
in the event the committee rules contrary to my interests as
beneficiary to unalienable benefits.

"ERISA's pension plan anti-alienation provision is mandatory and
contains only two explicit exceptions, see  1056(d)(2), (d)(3)(A),
which are not subject to judicial expansion."  See Guidry v. Sheet
Metal Workers Nat. Pension Fund, 493 U.S. 365, 376 (1990)....
"Besides the anti-alienation provision, Congress has enacted other
protective measures to guarantee that retirement funds are there
when a plan's participants and beneficiaries expect them.  There
are, for instance, minimum funding standards for pension plans and a
pension plan termination insurance program which guarantees benefits
in the event a plan is terminated before being fully funded.  See 
1082, 1301-1461.  Under respondents' approach, retirees could find
their retirement benefits reduced by substantial sums because they
have been diverted to testamentary recipients."
Boggs id.

If Congress only provided two explicit exceptions to the ERISA plans
as the court says here, it doesn't matter who the parties are,
private or government as the same law applies to both.  No circuit
court case can overturn the Supreme court judgments.  If Congress
had sought to allow other exceptions, they would have specified them
in the code.  Since alienation is forbidden in the interests of
providing a min. level of guaranteed benefits, then surely they
would have listed taxation as an overriding exemption to the plans. 
They did not.  The court says it is a matter for Congress and not
the court to enlarge the provisions of exceptions to the plans. 
Congress has not done so, despite the fact that there is a
controversy and conflict in the law as written when viewed from the
IRC and possibly within the ERISA itself.  However it is evident
that the Supreme authority on the law views that there are only two
exceptions, that being child support and 10% alienation.

There is no provision in the plan to assign benefits by unvoluntary
assignment of benefits upon any tax levy.  There is no express
provision in the IRC to assign ERISA benefits to the IRS by
unvoluntary assignment nor is there an express exception in ERISA to
unvoluntary assignment of benefits to the IRS for any matter.  The
code itself is completely silent on this type of alienation of
benefits, therefore either Congress needs to address the matter
specifically and either provide for such exemption in ERISA code, or
provide for such explicitly in the IRC.  Such is not the case.

So, the issue is from the IRS point of view and I maintain the 9th
Circuit errors when it contradicts what the Supreme court has said,

"As an initial matter, the Internal Revenue Code expressly indicates
that no other federal law shall exempt property from the IRS's authority to
levy a delinquent taxpayer's property under  6331. See 26 U.S.C.  6334
(c).  Moreover, ERISA's anti-alienation clause cannot prevent the IRS from
undertaking what would otherwise be a valid exercise of its levy
authority under 26 U.S.C.  6331, because ERISA itself has a saving clause
that states: "Nothing in this subchapter [which includes the anti-
alienation provision] shall be construed to alter, amend, modify, invalidate, impair, or
supersede any law of the United States." 29 U.S.C.  1144(a). The only other
circuit that has addressed this issue reached the same conclusion, which authority we find persuasive. See Shanbaum v. United States, 32 F.3d 180, 182-83 (5th
Cir. 1994);  cf. United States v. Sawaf, 74 F.3d 119, 123-24 (6th Cir. 1996)
(upholding the treasury regulation that authorizes the IRS to levy on the benefits
of an ERISA-governed plan and applying that regulation to uphold the IRS's
collection against such benefits); Anderson v. United States, 149 B.R. 591, 595
(9th Cir. BAP 1992) (upholding a tax lien against benefits from an ERISA-
governed plan).

4   We think it is plain that the IRS's authority to proceed against
a delinquent taxpayer's interest in benefits from an ERISA-governed plan is not
constrained by ERISA's anti-alienation provision."  McIntyre v. USA, 222 F3d 655
(9th 2002)

Here is what the IRS tax division judgment manual tell their agents,
notice how they make their own law by quoting the IRM which isn't

"Retirement accounts and funds such as Individual Retirement
Accounts and  401(k) plan funds are frequently the largest asset
and the only liquid asset in the hands of a judgment debtor. Such
funds may not be subject to judicial garnishment or execution, yet
the IRS can use its broad levy power under I.R.C.  6331 to attach
the funds. Pursuant to I.R.C.  6334(c), notwithstanding any other
law of the United States, no property or rights to property is
exempt from an IRS levy other than the property specifically made
exempt by  6334(a). See 2 Administration, CCH Internal Revenue
Manual, Part V, Collection Activity,  536(14).22, 536(14).5, which
set forth internal IRS guidelines as to when and how the IRS should
levy on retirement funds. Internal Revenue Manual 536(14).5(1)

  Qualified pension, profit sharing, stock bonus, IRA plans and
retirement plans benefiting self-employed individuals, or interest
earned on these plans, are not exempt from levy. However, because
the plans are established for the taxpayer's future welfare, they
will be levied upon judiciously.

While the IRS Manual does not define the term "judiciously" it does
state, in paragraph 536(14).22:

  Retirement plan benefits (income) receivable from a qualified
pension fund or account, generally will not be levied upon if the
annual benefits are $6000 or less ($500 or less per month).

Accordingly, if your investigation discloses substantial assets or
income in a retirement or pension fund, you should consider asking
the IRS to levy on the funds (or the income from the funds) in
accordance with the pertinent provisions of the IRS Manual.
"In Brunwasser v. Davis, 63 A.F.T.R.2d (P-H) 675 (W.D. Pa.1989), the
district court denied a request for an injunction against IRS
levies "against an individual retirement account, retirement plan
and any other qualified pension, profit sharing and stock bonus
plan." Similarly, in First Fed. Savs. and Loan Ass'n v. Goldman, 644
F. Supp. 101 (W.D. Pa. 1986), the court held that an IRS levy
attached to an IRA account because no property or rights to property
are exempt from levy other than property specifically exempted by
I.R.C.  6334(a).

I.R.C.  6334(a)(6) specifically exempts from levy certain
enumerated annuity and pension payments. The only such amounts
enumerated in  6334(a)(6), however, are benefits under the Railroad
Retirement Act, the Railroad Unemployment Insurance Act, special
pension payments received by a person whose name has been entered on
the Army, Navy, Air Force, and Coast Guard Medal of Honor roll, and
annuities based on retired or retainer pay under chapter 73 of 10

In Melechinsky v. Secretary of the Air Force, 51 A.F.T.R.2d(P-H)
1276 (D. Conn. 1983), the district court held that military
retirement benefits are not exempt from an IRS levy because only
items specifically enumerated in I.R.C.  6334 are exempt from levy
and  6334 does not exempt such benefits. Cf. United States v.
Metropolitan Life Ins. Co., 691 F. Supp. 1339 (S.D. Ala. 1988) (IRS
levy attaches to cash surrender value of taxpayer's life insurance
policy. IRS steps into shoes of delinquent taxpayer and can itself
exercise taxpayer's right to compel life insurance company to pay
cash surrender value of annuity contract)."

Administrative levy is more effective because there are less
limitations as explained by the Collection Judgments manual so
generally they use this blatant fraud to get around what they can't
do in court:

"An IRS levy has a number of advantages over judgment execution
procedures. First, a levy is a quick, efficient, and effective means
of seizing property in order to satisfy a tax liability. Judgment
execution procedures are somewhat more cumbersome, requiring more
paperwork and the involvement of the court or the marshal. Second,
some types of property can be reached with a levy, such as a
taxpayer's interest in an IRA or qualified pension or profit-sharing
plan, that might not be subject to judgment execution processes
because of state exemption provisions.  A levy can even be made on
Social Security payments, although such levies are made only in
abusive situations.  Third, the property exempt from an IRS levy is
very limited in comparison to property exempt from judgment
execution procedures." 

 The 9th circuit court completely and conveniently ignores Boggs v.
Boggs, 520 U.S. 833 (1997), relying instead on another errant 6th
circuit court 1996 decision.  Since when does the 9th circuit
overrule the supreme court?  Obviously they like real loose
administrative procedures because if the party holding the property
is kind enough to just hand it over, they have it easy.  Most of the
time it works their way because there is nothing such as property
rights anymore, just a land full of thieves.

In particular in Guidry see the notes:

11. The anti-alienation provision permits "any voluntary and
revocable assignment of not to exceed 10 percent of any benefit
payment."  29 U.S.C.  1056(d)(2).  The Conference Report
states:  "For purposes of this rule, a garnishment or levy is not to
be considered a voluntary assignment."  H.R.Conf.Rep. No. 93-1280,
p. 280 (1974).

Now, we have established the fact that garnishment is not a
voluntary assignment as far as ERISA goes but that is just a example
of the law of alienation of protected benefits for an example to
show that no one can say that you voluntarily assign any SS benefits
as well.

13. The garnishment of retirement benefits is prohibited by the
Social Security Act, 42 U.S.C.  407; the Railroad Retirement Act,
45 U.S.C.  231m(a) (1982 ed. Supp. V); the Civil Service .   
Retirement Act, 5 U.S.C.  8346(a); and the Veterans' Benefits Act,
38 U.S.C.  3101(a).

The court said it not me, SS garnishment is prohibited, and the
lawless IRS does this to countless millions.  So, I suggest you walk
into the IRS office near you at your convenience as they have a walk-
in policy and give them both barrels in an administrative hearing,
and file what I call a KGB letter with them and a First Amendment
Complaint that they are unlawfully taking your SS and you demand a
refund unless they can show a case which overturns what the Supreme
court has declared in this case.

Then make a record of the hearing by secret recording and by witness
to the fact that you presented them with the proof that they are in
error.  Write it up and submit it to them for their approval and if
you can do it in person with a witness so much the better especially
if the same witness you had before.  Ask them to approve it as a
true administrative record of the meeting.  If they refuse, ask them
for a letter and you will wait till they make it to the fact that
they have read it and refuse to sign it although they offer no
excuse why it is not a true record.

Then do a Second First Amendment Complaint with the facts of your
hearing and their refusal to play fair and give due process.  Tell
them you will sue them personally as well as the Commissioner for
failure to hew to the law, and that you will demand sanctions on
them from their pay as well as damages for intentional irreparable
injury to you.  Do also inform them that intentional irreparable
injury is a crime and the American people don't hire criminals, so
you will also demand their discharge from public service.  Collect
as much information on them as you can, because you want to be
Gentle, right?

When they don't answer your second complaint which has a default on
the first and warning to cure, then file a default administrative
judgment against them just like they would do to you.  Because you
are paying first by force of seizure, you can go to the District
court and they should stop it.

The DOJ openly admits they use the administrative procedure to get
around the law as the courts will uphold it.  They can do things by
administrative procedure that they could never get away in the
courts.  Just read the DOJ manual on tax seizures.  Anyway, seek out
like victims and let them know about this landmark case and what the
court has said about it.