Protect Tax-Advantaged Accts. & Living Donors.

GENERAL ASSEMBLY OF NORTH CAROLINA
SESSION 2025
S 2
SENATE BILL 101
House Committee Substitute Favorable 6/24/25

Short Title: Protect Tax-Advantaged Accts. & Living Donors. (Public)
Sponsors:
Referred to:
February 17, 2025
*S101-v-2*
A BILL TO BE ENTITLED 1
AN ACT TO INCREASE P ROTECTIONS FOR FUNDS HELD IN EDUCATION SAVINGS 2
AND INVESTMENT ACCOU NTS AND ABLE ACCOUNT S FROM CLAIMS OF 3
CREDITORS AND OTHER JUDGMENTS, TO PROTEC T LIVING ORGAN DONOR S 4
FROM POTENTIAL INSUR ANCE DISCRIMINATION, AND TO PROVIDE PAID 5
LEAVE TO STATE EMPLO YEES AND OTHER STATE -SUPPORTED PERSONNEL 6
WHO SERVE AS LIVING ORGAN DONORS. 7
The General Assembly of North Carolina enacts: 8
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PART I. PROTECT CERTAIN TAX-ADVANTAGED ACCOUNTS 10
SECTION 1.(a) Article 16 of Chapter 1C of the General Statutes is amended by 11
adding the following new section to read: 12
"§ 1C-1601.5. Certain tax-advantaged accounts exempt. 13
(a) For purposes of this section, the following definitions shall apply: 14
(1) Qualifying account. – Any of the following: 15
a. An education savings and investment plan account qualified under 16
section 529 of the Internal Revenue Code. 17
b. An AB LE account qualified under section 529A of the Internal 18
Revenue Code. 19
(2) Qualifying purpose. – Any of the following: 20
a. For education savings and investment plan accounts, any purpose 21
permitted under section 529 of the Internal Revenue Code. 22
b. For ABLE accounts, any purpose permitted under section 529A of the 23
Internal Revenue Code. 24
(b) Notwithstanding any oth er provision of law, including G.S. 1C-1601(e), funds 25
located in a qualifying account or withdrawn from the account and used for a qualifying purpose 26
shall not be subject to liens, attachment, garnishment, levy, seizure, any involuntary sale or 27
assignment by operation or execution of law, or the enforcement of any other judgment or claim 28
to pay any debt or liability of any account owner, beneficiary, or contributor to an account. 29
(c) Nothing in this section shall be construed to do any of the following: 30
(1) Prohibit the distribution of funds from an ABLE account following the death 31
of the account owner under G.S. 147-86.73(e) or section 529A of the Internal 32
Revenue Code. 33
(2) Limit the enforcement of judgments o r claims on funds that meet any of the 34
following criteria: 35
a. Were not used for a qualifying purpose. 36
General Assembly Of North Carolina Session 2025
Page 2 Senate Bill 101-Second Edition
b. Were deposited into a qualifying account as a result of fraud, 1
intentional wrongdoing, or other violation of law." 2
SECTION 1.(b) G.S. 1C-1601(a)(10) is repealed. 3
SECTION 1.(c) This section becomes effective September 1, 2025, and applies to 4
actions filed on or after that date. 5
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PART II. LIVE ORGAN DONOR PROTECTIONS 7
SECTION 2.(a) G.S. 58-3-25 is amended by adding a new subsection to read: 8
"(d) No insurer shall refuse to insure or to continue to insure an individual; limit the 9
amount, extent, or kind of coverage available to an individual; charge an individual a different 10
amount for the same coverage; or otherwise discriminate against an individual in the offering, 11
issuance, cancellation, price, o r conditions of a policy, or in the amount of coverage provided 12
under a policy, based solely and without any additional actuarial risks on the status of an 13
individual as a living organ donor. This subsection shall apply to health benefit plans and life, 14
accident and health, disability, disability income, and long-term care insurance policies. For the 15
purposes of this subsection, the phrase "a living organ donor" shall mean a living individual who 16
donates one or more of that individual's human organs, including bone marrow, to be medically 17
transplanted into the body of another individual." 18
SECTION 2.(b) Article 2 of Chapter 126 of the General Statutes is amended by 19
adding a new section to read: 20
"§ 126 -8.7. Paid leave for State employees and State -supported personnel for organ 21
donation. 22
(a) Full-Time Employees. – The State Human Resources Commission shall adopt rules 23
and policies to provide that a permanent, full -time State employee may take, in addition to any 24
other leave available to the employee, up to (i) 30 days of paid leave for the purposes of serving 25
as a living organ donor and (ii) seven days for serving as a bone marrow donor. The employee 26
must have been continuously employed by the State for at least 12 months immediately preceding 27
the first request for paid organ or bone marrow donation leave. 28
(b) Part-Time Employees. – The State Human Resources Commission shall adopt rules 29
and policies to provide that a permanent, part -time State employee may take, in addition to any 30
other leave available to the employee, a prorated amount of up to (i) 30 days of paid leave for the 31
purposes of serving as a living organ donor and (ii) seven days for serving as a bone marrow 32
donor. The employee must have been continuously employed by the State for at least 12 months 33
immediately preceding the first request for paid organ or bone marrow donation leave. 34
(c) Program Requirements. – The paid leave for organ or bone marrow donation 35
authorized by this section: 36
(1) Is available without exhaustion of the employee's sick and vacation leave. 37
(2) Is in addition to, and not in lieu of, shared leave under G.S. 126-8.3, or other 38
leave authorized by federal or State law. 39
(3) May not be used for retirement purposes. 40
(4) Has no cash value upon termination from employment. 41
(d) Applicability. – This section applies to all (i) State employees and (ii) State-supported 42
personnel, with the appropriate governing board adopting rules and policies to provide paid leave 43
for organ donation to its employees as provided by this section. 44
(e) Reporting. – By April 1, 202 6, and then annually thereafter, the State Human 45
Resources Commission, the State Board of Education, the State Board of Community Colleges, 46
and all State agencies, departments, and institutions shall annually report to the Office of State 47
Human Resources on the paid organ donation leave program." 48
SECTION 2.(c) G.S. 126-5 is amended by adding a new subsection to read: 49
"(c22) The provisions of G.S. 126-8.7 shall apply to all State employees, public school 50
employees, and community college employees." 51
General Assembly Of North Carolina Session 2025
Senate Bill 101-Second Edition Page 3
SECTION 2.(d) Subsection (a) of this section is effective 30 days after it becomes 1
law and applies to insurance contracts issued, renewed, or amended on or aft er that date. The 2
remainder of this section is effective when it becomes law. 3
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PART III. EFFECTIVE DATE 5
SECTION 3. Except as otherwise provided, this act is effective when it becomes 6
law. 7