If you are facing a divorce in Riverside County, you should understand the concept of the equal division of marital property between spouses under California’s community property rule. This rule means that all assets, property, and debt that you and your spouse have acquired during the life of your marriage is considered equally owned by both of you. When divorcing, this property then becomes subject to a 50-50 split. Under the concept of marital property is included the value of retirement benefits that either spouse has accrued during the years of the marriage.
In order to ensure that certain types of retirement plans can be considered subject to the community property rule, a special kind of court order must be issued to give joint marital rights of both parties to these plans. That court order is called a Qualified Domestic Relations Order (QDRO). This order includes specific instructions to the administrator of the retirement plan in question as to how the plan will be divided between the two parties. The QDRO cannot grant an amount or type of benefit that is not specifically outlined under the retirement plan it addresses.
In a QDRO, the spouse who has worked and participated in the plan is referred to as the participant while the other spouse who will receive a portion of the plan’s value is referred to as the nonparticipant or the alternate payee. The nonparticipant spouse may receive benefits while the participant is alive or may also receive survivor benefits if the participant passes away.
QDROs are often issued as a separate document to the divorce decree. These documents clarify the issue because often retirement plans will reject any attempt to collect benefits from a nonparticipant spouse without one. Many plans require a separate QDRO in order to pass forth any benefits to the nonparticipant spouse. A QDRO cannot generally be obtained once a divorce has been finalized and is over.
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More About QDROs
Not all plans require a QDRO in order to be subject to the equal division of their value. Those that do not include IRAs, government retirement plans, military pension plans, and deferred annuities. Other plans, like 401(k)s and others do require a QDRO. When heading for divorce, you should discuss this matter with your attorney to determine if your retirement plan or your spouse’s plan is the type that will require a QDRO so that this issue can be addressed.
To further explain how retirement benefits are split under a QDRO, if your spouse worked for 1200 months and you were married for 800 of those months, you would generally be able to receive half of the value accrued during those 800 months.
Need Further Help Understanding a QDRO & How It Relates to You?
The rules pertaining to QDROs and retirement plans can be complicated and ever-evolving. Various types of retirement plans exist and they all have their own specific characteristics and requirements. Each QDRO must be customized to the plan and various circumstances it addresses. For that reason, it is best to discuss the matter with your divorce attorney as soon as possible.
At Hanson, Gorian, Bradford & Hanich, you can work with a family law team that includes a Board Certified Family Law Specialist who has attained this rare achievement through years of experience, advanced education, and a tough exam. Our firm stays up to date on changes to the law and brings compassion and dedication to your case.
Contact us at (951) 506-6654 to get the legal counsel you need today.