To divide retirement plans and benefits in a divorce, the couple may need to fill out a qualified domestic relations order (QDRO), or a comparable order. But, filling out such a form can seem overwhelming, especially to someone who has never done it before. For this reason, our Texas divorce lawyers have created this page to help guide you as much as possible. We will discuss some of the important information that you need regarding QDROs as well as how to prepare them in your divorce.
Read on for more information or call (844) 451-1220 to speak to our Texas divorce attorneys about your specific situation. Walters Gilbreath, PLLC has offices in Houston, Dallas, and Austin for your convenience.
Models for the Qualified Domestic Relations Order
First, there are several different models that are available for models related to the type of retirement plan(s) that you are dealing with in your divorce. These include private plans, local government plans, state government plans, federal plans, and more. You can find most of these models online or by contacting the correct agency. If you contact an experienced Texas divorce attorney at Walters Gilbreath, PLLC, we will have them. Your lawyer can walk you through the form and help you draft your qualified domestic relations order properly.
One significant aspect of the QDRO is the various benefit orders involved. One benefit to consider comes from shared interest vs. separate interest. Shared interest means that the alternative payee gets part of the benefit when their ex-spouse does. This means after retirement or after some form of termination from the job, the alternative payee will get their portion of the benefit. Note that this benefit is dependent on the participant’s benefit and when they receive it.
On the other hand, separate interest means that the benefit is split in two. The participant gets part of it, and the alternative payee gets part of it. This can happen at any time, and their benefit becomes separate from the participant’s benefit. This means that it does not depend on the participant’s benefits. These types of interest must get accounted for when filling out the QDRO.
Another benefit is the surviving spouse benefit, of which there are two types:
- The post-retirement qualified joint and
- Survivor annuity (QJSA) and the qualified pre-retirement survivor annuity (QPSA)
These types of benefits also rely on separate and shared interest. You should make sure that these benefits are properly represented in the QDRO and that your rights are protected in any other situation (i.e. the death of an ex-spouse).
Early retirement benefits might also relate to your divorce. If early retirement benefits apply to one spouse, the QDRO should clearly state if the other spouse can share in these benefits.
Finally, there is cost of living adjustment benefits that can apply to benefits in a divorce. Again, this information should get included in the QDRO.
Filing the QDRO
There are many factors involved in the QDRO, but when you feel that you have filled it out correctly, you will then enter the pre-approval stage. If you are filling out a QDRO for yourself, or you can’t find a model for your retirement plan, you can submit the QDRO for pre-approval. Submitting the plan for pre-approval can save time and money in the long run, especially if you are unsure as to what you are doing.
Once the QDRO gets approved, you should enter it when you enter your divorce decree. While you can enter a QDRO at any time during your divorce, it is best to enter it with the decree. This allows time to make any changes if an error is spotted or something can’t be agreed upon. It is best to be proactive and get the QDRO out of the way as soon as possible in the divorce.
Another good idea is to hire a Texas family lawyer to assist you with this process. While you can often find models for QDROs online, if you want peace of mind you should hire a lawyer. They will have experience with these forms and can take care of them for you. You won’t have to worry about if you are filling everything out correctly if you contact an attorney.
At the end of your divorce, you should want to feel confident that your retirement benefits have been fairly distributed. In order to do so, a QDRO may need to be completed. This is a process, just like your divorce so it may take time. However, if done properly initially, you can ensure to not waste time or money.