Going through a divorce in Philadelphia is never easy. Even if you are going through your second or third divorce, it can still be difficult to handle. You need to make informed, smart decisions during the entire process. That includes figuring out how your retirement assets are divided between you and your soon-to-be ex. The best way to protect your rights is through a Qualified Domestic Relations Order (QDRO).
As you look further into what a QDRO can do, you will find that it handles more than just the division of retirement assets. It can also impact alimony, property division and child support. It is a court ordered document that can be enforced with the help of your divorce attorney.
When a QDRO is created, it allows you to withdraw money from a retirement account without facing any penalties. The non-employee spouse can then deposit this money into their retirement account, such as their IRA, or can make other plans for accepting the payout.
An important note here is that a QDRO only works for retirement plans that are covered by the Employee Retirement Income Security Act, also known as ERISA. The retirement plans also have to be tax-qualified by the Internal Revenue Service. Also know that a QDRO does not cover government or military pensions. These pensions are governed by other laws.
How do you protect your retirement assets? A QDRO is a great place to start. Figuring out how to divide assets in a divorce in Philadelphia is difficult. Make sure you have all of your bases covered before filing for divorce.
Source: The Balance, "How Retirement Plan Assets are Divided in a Divorce," accessed April 27, 2018