Pennsylvania Statutes Title 24 Pa.C.S.A. Education § 8533. Taxation, attachment and assignment of funds

(a) General rule.--Except as provided in subsections (b), (c) and (d), the right of a person to a member's annuity, a State annuity, or retirement allowance, to the return of contributions, any benefit or right accrued or accruing to any person under the provisions of this part, and the moneys in the fund and the trust are hereby exempt from any State or municipal tax, levy and sale, garnishment, attachment, the provisions of Article XIII.1 of the act of April 9, 1929 (P.L. 343, No. 176),  1 known as The Fiscal Code, or any other process whatsoever, and shall be unassignable.

(a.1) Individual investment accounts and distributions.--No participant or beneficiary, successor payee or alternate payee of a participant shall have the ability to commute, sell, assign, alienate, anticipate, mortgage, pledge, hypothecate, commutate or otherwise transfer or convey any benefit or interest in an individual investment account or rights to receive or direct distributions under this part or under agreements entered into under this part except as otherwise provided in this part and in the case of either a member or a participant.

(b) Forfeiture.--

(c) Domestic relations order.--Rights under this part shall be subject to attachment in favor of an alternate payee as set forth in an approved domestic relations order.

(d) Direct rollover.--Effective with distributions made on or after January 1, 1993, and notwithstanding any other provision of this part to the contrary, a distributee may elect, at the time and in the manner prescribed by the board, to have any portion of an eligible rollover distribution paid directly to an eligible retirement plan by way of a direct rollover. For purposes of this subsection, a “distributee” includes a member, a participant, a member's surviving spouse, a participant's surviving spouse, a member's former spouse who is an alternate payee under an approved domestic relations order, a participant's former spouse who is an alternate payee under an approved domestic relations order and anyone else authorized under the IRC and the plan terms approved by the board to have an eligible rollover distribution paid directly to an eligible retirement plan by way of a direct rollover. For purposes of this subsection, the term “eligible rollover distribution” has the meaning given such term by IRC § 402(f)(2)(A) and “eligible retirement plan” has the meaning given such term by IRC § 402(c)(8)(B), except that a qualified trust shall be considered an eligible retirement plan only if it accepts the distributee's eligible rollover distribution; however, in the case of an eligible rollover distribution to a surviving spouse, an eligible retirement plan is an “individual retirement account” or an “individual retirement annuity” as those terms are defined in IRC § 408(a) and (b).