When couples divorce they need to reach agreement on how the marital estate will be divided, otherwise a judge will do this for them. One asset that may be divided is the retirement account of the majority breadwinner. Division of a pension, called a Qualified Domestic Relations Order (QDRO) can be very complex. It is important that you have a Conroe family law attorney in your corner when you divorce, but particularly when a QDRO is being drawn.
Why Would a Pension Be Divided?
When couples divorce division of assets is often a matter of much contention. Family heirlooms, liquid assets, and the family home are among the property most likely to be argued over. The family court judge will award property from the estate in accordance with the needs of both parties, but with emphasis upon making sure that the party that is the lesser breadwinner is maintained in an adequate lifestyle.
Under normal circumstances only the spouse who participated in a retirement plan is entitled to receive benefits. Texas law provides, however, “alternate payees” under certain circumstances. These can only be spouses, former spouses, and dependents of the party who participates in the retirement plan.
How Does the QDRO Work?
Once the QDRO is set up, an administrator is named who distributes the benefits as ordered. Sometimes the family court will order that the non-participating party receives a set amount of the pension benefits. Often, however, there is no such amount ordered, in which case the administrator will use a formula to make this determination. This is where things can become complicated, and why you will need a highly competent Conroe family law attorney experienced in such matters to help.
One might assume that the pension will be divided equally. However, such is not necessarily the case. If the participating spouse began making contributions to the plan before the marriage, he or she will receive that much more than 50% of the benefits. In any event, once the non-participating party receives her portion she can either withdraw it or roll it over into her own IRA.
If You Have Further Questions
If you would like more information about Qualified Domestic Relations Orders, contact an experienced and knowledgeable Conroe family law attorney. Call Peterson Law Group today at 979-703-7014 or 936-37-4681.