Receiving your share of your spouse’s 401(k) may be one of your priorities in your upcoming divorce. In order to divide a 401(k), you need a court to approve a qualified domestic relations order or a QDRO. To ensure a smooth process with your property division in divorce, it’s important to review the QDRO carefully before submitting it to the court.
Because divorces involve many different financial situations, QDROs tend to differ widely as well. Still, CNBC points out some aspects of a QDRO that anyone may benefit from reviewing.
Compliance with the divorce settlement
Remember that a QDRO is separate from your divorce settlement. Your divorce decree may declare what should happen to your 401(k) or your other retirement accounts, but it means nothing unless a court approves a QDRO. It’s important to consult with experienced family law lawyers to ensure your QDRO reflects the intentions of your divorce settlement and that no conflicts exist.
The number of accounts to divide
You may want to divide another retirement account in addition to your 401(k). If so, one QDRO will not be enough. A court has to approve a QDRO for each account you wish to divide. So if your initial QDRO lists multiple accounts, you and your attorney should go back and draft separate QDROs for each account you want to split between you and your spouse.
The method of division
Your QDRO should also describe how you want to divide your 401(k). For instance, you may want to receive money directly from the 401(k). Alternatively, you may prefer to transfer your share into a rollover IRA. However you want to receive your portion, the QDRO should be specific in describing your method of division.
Dividing up your 401(k) or other retirement accounts will likely require some legal expertise to give you the best chance of coming out of your divorce with a good portion of your marital nest egg. Contact our law firm at Daughtry, Woodard, Lawrence, & Starling for more information on this subject.
