Explaining the QDRO Process
QDRO stands for Qualified Domestic Relations Orders. Here is some important information explaining the QDRO process by our experienced Saratoga divorce attorneys.
Explaining the QDRO Process | What is QDRO?
When couples divorce, the assets they’ve reserved for retirement can be divided proportionally without tax liability under ERISA, the federal statute that regulates retirement benefits. Whether your retirement plan is a defined contribution or a defined benefit plan, you will need a qualified domestic relations order (QDRO) signed by a judge and accepted by the plan to affect a division of the marital portion of the fund. The divorce attorneys at Jean M. Mahserjian, Esq., P.C. have vast experience obtaining QDROs and interfacing with plan administrators to secure a division of the funds.
Explaining the QDRO Process | When to Submit a QDRO
Typically, you should submit a QDRO with your judgment of divorce. You can submit a QDRO later, but some judges now require it to be submitted at this juncture. You definitely don’t want to forget to submit one. If something happens to your ex-spouse and you haven’t submitted a QDRO, you will not be able to obtain those funds. You want to make sure that you do it as soon as possible, preferably when the judgment of divorce is forwarded to the judge.
Explaining the QDRO Process | QDRO Distribution
When you get a QDRO done, typically in matrimonial, it is divided 50/50. This is per the Majauskas Rule, which is pursuant to case law. However, you don’t have to divide your retirement plan 50/50. If the parties agree, they can use whatever percentage they want.
Explaining the QDRO Process | Not Having a QDRO
As an experienced Saratoga divorce attorney, I often speak with clients who have been divorced and aren’t receiving their share of the compensation plan. If the plan no longer exists, a significant court skirmish will be required to determine how to best address the rights of the spouse who didn’t receive their share. If the plan does exist, other problems may arise.
In the case of a profit-sharing 401k or other deferred compensation plan, appreciation may have accrued on the non-titled spouse’s share. However, they man not be entitled to that appreciation depending upon the divorce agreement that was written, or the judgment rendered. Detailed exploration of those rights can uncover significant difficulties for the party not titled to those funds.
If you need more explanation of the Qualified Domestic Relations Order process, please contact our experienced Saratoga divorce attorneys today. Let our experience work for you.