- 06
- January
2012
A qualified domestic relations order (Q.D.R.O.) is a legal order following a divorce or legal separation that apportions and changes partial ownership of a retirement plan giving the divorced spouse their share of a claimed marital asset. Q.D.R.O.'s are often intricate and time-consuming matters for parties and their attorneys.
When dealing with a Q.D.R.O., the first question to ask is what kind of retirement benefit plan do you or spouse have? Knowing the kind of retirement benefit plan is important when dealing with a Q.D.R.O. Next, the type of retirement plan can determine whether or not a Q.D.R.O. is necessary. For example, an individual retirement account (IRA) or simplified employee plan (SEP) does not require a Q.D.R.O. Another question to ask is whether the retirement plan can be divisible by Q.D.R.O. Once there has been a determination that a Q.D.R.O. is necessary, there must be a determination made for: the date of division; adjusted award amount for earnings and losses; who will be a surviving spouse; are there any loan balances; who is entitled to subsequent contributions after the establishment of the Q.D.R.O.; and finally, who is preparing the Q.D.R.O.
A Q.D.R.O. can cause problems far after a divorce or legal separation has been finalized. If you have any questions concerning your spouse's retirement benefits or have been discussing a Q.D.R.O. and would like assistance, please contact our office.
