Pensions, Divorce and QDROs
Key Points
  • When splitting up a pension the alternate payee receives his or her money through the creation of a QDRO or DRO.
  • QDRO’s or DRO’s set out the rights of the alternate payee and the responsibilities of the Plan and participant to effectuate teh division of the pension according to the settlement agreement.
  • QDRO’s can be created to include provisions for child support or alimony if necessary.

According to the Employee Retirement Income Security Act of 1974 (ERISA) a Qualified Domestic Relations Order (QDRO) is a judgment, decree or order that creates or recognizes the existence of an alternate payee's right to receive all or a portion of a plan participant's benefits under an ERISA-qualified employee benefit plan. A Domestic Relations Order (DRO) achieves the same purpose as a QDRO, but applies only to non-qualified plans, such as state & local governments and public school teachers retirement systems.

The most common reason for drafting a QDRO or DRO is to effectuate the division of a pension pursuant to an equitable distribution agreement in a divorce. However, QDROs can be used for the provisions of child support or other marital property rights, such as alimony, in which a plan participant may be delinquent.

A QDRO or DRO must contain certain general information about the two parties, such as their addresses, social security numbers, dates of birth, as well as, specific information that would be set forth in the guidelines of the plan to which the order applies. A QDRO or DRO cannot instruct a pension plan to disburse benefits to an alternate payee or give an alternate payee any rights or privileges that are not set forth in their guidelines.

Suggested Reading
Pension Issues in Divorce Pension Issues in Divorce
When couples get divorced they must decide how to divide their property. Retirement benefits (pensions) often form a substantial part of the parties' total marital estate and many times are the largest single marital asset afforded the couple. Similar to other assets, pensions are typically divisible in cases of divorce to the extent that they are acquired during the period of marriage.

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GOOD LEGAL ADIVCE -- The division and distribution of pensions often becomes very complicated, and these issues probably generate more appeals and reversals on appeal than any other issue in equitable distribution. Woman must learn how to ask the right questions when facing the distribution of pensions and retirement plans.

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Online QDRO Preparation

Online QDRO Preparation
QdroDeskTM. provides family law attorneys, their clients, and pro se filers an instant, easy, accurate, and affordable way to prepare Qualified Domestic Relations Orders (QDROs), the appropriate settlement agreement language, and processing instructions. And does it all online, with an easy to use, question-and-answer format that has made QdroDeskTM. an industry leader.

Online Pension Valuations

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PensionAppraisalDeskTM uses a mathematical, web-based calculation software that gives family law attorneys, their clients, and pro se filers an instant, easy, accurate appraisal of the present value of pension benefits for equitable distribution upon divorce.
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