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What is the role of a QDRO in a divorce?

On Behalf of | Mar 9, 2021 | High Asset Divorce

There are so many laws and rules about divorce that it can seem like it has its own language. The jargon around divorce can make it hard for people to understand what they read in legal documents and what they hear in court.

One of the terms that people often throw around in high-asset divorces specifically is the acronym QDRO. It stands for qualified domestic relations order. When do you need one and what is the role of a QDRO in your divorce?

A QDRO helps split retirement or pension accounts

Many employer-sponsored retirement pensions and retirement savings plans are in the name of only one person — typically, the person who is making direct contributions from their paycheck. However, that doesn’t mean their retirement or pension is their separate property.

Any amount that a person earned before they got married will usually stay separate, but retirement savings accumulated during the marriage is usually marital property that both spouses have a claim to in the divorce.

A QDRO is drafted after the divorcing couple decides how the retirement account or pension will be split in the divorce. The court will then review and approve the document. Finally, it goes to the plan administrator, which uses it to create a new account for the spouse not originally named on the account.

A QDRO is a valuable tool for dividing assets during divorce, but negotiating the terms for splitting a retirement account can be complicated and difficult. The better you understand the process, the easier it will be for you to work with your attorney to seek the best outcome.

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