Dividing money and property in a divorce can always be complex. However, the process can become more complicated if one or both spouses have retirement accounts. Like any other assets, investments, or property, the state of Florida requires equitable distribution of the retirement accounts between the spouses. The process of dividing retirement accounts can require additional paperwork, calculations, and more, so it is important to have an attorney on your side who understands how to negotiate for the fairest division of these accounts in accordance with Florida law.
One important tool in dividing rights to retirement accounts is the Qualified Domestic Relations Order, commonly called the QDRO. When a person owns a retirement account, he or she will likely initially be the only payee who will receive the proceeds of that account. However, retirement funds saved and invested during a marriage are considered to be marital property, even if the funds only came as a result of the job of one spouse. In the event of a divorce, one spouse may obtain the rights to also be an alternate payee for the retirement account.
However, certain plans such as those under the Employee Retirement Income Security Act (ERISA) will not simply pay the funds to an alternate payee without the appropriate paperwork. In such situations, a QDRO is needed to ensure the divided funds go to the former spouse or other dependent.
A QDRO is a court order that legally instructs the retirement or pension plan to split the payouts among the designated payees according to the percentages or amounts set out in the QDRO. A QDRO can be used to obtain retirement funds for the following reasons:
- As part of the division of marital property;
- As part of spousal support payments;
- As part of child support payments.
Simply because divorcing spouses agree to divide retirement accounts does not mean that the retirement plan is under any legal obligation to do so unless it has a QDRO. The amount that must be paid according to the QDRO will depend on many factors including whether there were retirement savings prior to the marriage or any specific property division agreements that divided the accounts in a way that was not 50% for each spouse.
In order to be valid, a QDRO must have many specific pieces of information, including:
- The name of the retirement plan;
- The full name, social security numbers, and contact information for both the initial payee (the employee) and any new alternate payees under the QDRO;
- The amount to be paid to each payee and the duration for benefits to be paid to the alternate payee, if applicable.
Contact a Qualified Divorce Lawyer in Boca Raton Today
Dividing assets in divorce can be relatively simple or can be extremely complicated. Whether your property is minimal or whether you and your spouse have multiple retirement accounts, business interests, real estate properties, and more, the law office of Alan R. Burton in Boca Raton can help you. Mr. Burton is a highly experienced family law attorney and understands how to handle divorces involving high or low assets in the most efficient way possible. Please call for a free consultation at 954-220-1660 as soon as possible.