Overview: Effective August 1, 2018, up to $25,000 in a health savings account and/or medical savings account is exempt from garnishment, levy, and attachment.
Effective Date: August 1, 2018
Details: On May 3, 2018, Minnesota Governor Mark Dayton signed into law H2391, which provides that effective August 1, 2018, up to $25,000 in a health savings account and/or medical savings account is exempt from garnishment, levy, and attachment. However, it is important to note that the exemption does not apply to debts coming from the division of marital assets, a surviving spouse benefit, or a support order.
Specifically, H2391 amended Minnesota Statute Section 550.37 by adding the underlined language:
§550.37 PROPERTY EXEMPT
Subdivision 1. Exemption.
The property mentioned in this section is not liable to attachment, garnishment, or sale on any final process, issued from any court…
Subd. 26. Health savings accounts; medical savings accounts. (a) All money held in a health savings account, as defined in the Internal Revenue Code of 1986, section 223 (d), as amended, up to a present value of $25,000. 1.9 1.10
(b) All money held in a medical savings account, as defined in the Internal Revenue Code of 1986, section 220(d)(1), as amended, up to a present value of $25,000. 1.12
c) The exemptions in paragraphs (a) and (b) do not apply pursuant to the division of marital assets under section 518.58, a surviving spouse benefit under section 518.581, and a support order under section 518A.53. 1.14 1.15 1.11 1.13
Call to Action: ADP will make system modifications to comply with the disposable wage calculation. Please keep an eye out for additional communications. Because the amount of wages exempt from the support order is increasing, employees that have a court order for support in Minnesota may see a decrease in their lien deduction amounts once the system modifications have been applied.