What is a Domestic Relations Order (DRO)?
A domestic relations order is a judgment, decree or order, made pursuant to a state’s domestic relations or community property law, which relates to the provision of child support, alimony, or marital property rights to a spouse, former spouse, child or other dependent of a plan participant.
This was established as a result of the Retirement Equity Act of 1984, for the protection of spouses from the loss of pension benefits to which they may be entitled and pursuant to Code §414(p) and ERISA §206(d)
What is a Qualified Domestic Relations Order (QDRO)?
A QDRO is a domestic relations order that meets certain requirements specified under the law, is order by the appropriate court, and is approved by the Plan Administrator.
What plans do not require a QDRO or use special rules?
The following plans do not require additional documentation beyond a decree that specifies the allocation:
- IRA’s
- SEP’s
- SIMPLE’s
The following plans either require a different form of documentation or may not permit QDRO apportionment:
- Non-Qualified Plans
- Governmental (Federal, state, local or political subdivision) Plans
- Military Plans
What do I need in order to have a QDRO prepared?
If you’ve decided that you need a QDRO prepared in order to protect your entitlement, you need to have the following information to start:
- Name, address, social security number and date of birth for participant and alternate payee
- Name of plan to which order applies
- Amount of alternate payee account/benefit
- Manner of determination of alternate payee account/benefit
- Duration of payment.
Who should prepare a QDRO?
When a couple is going through a divorce, they sometimes lose sight of the bigger picture. The biggest material asset from the marriage is often the retirement assets which can be very tricky to divide. Loss of control and money often happen because QDRO and other retirement and pension orders are outside the scope of the expertise of divorce attorneys. Even some people who proclaim to be QDRO experts don’t have enough knowledge of retirement plan laws and how they really operate to do the best job for you. You want to do everything you can to ensure that everything is done correctly so you don’t lose out on money to which you are entitled. A licensed attorney whose practice concentrates in employee benefits will understand the particulars of each plan and any nuances that may impact how the apportionment is to be handled.
Trust Gary A. Nagler, PLLC to prepare your QDRO. Call (713) 666-7742 or CLICK HERE to get started now!
