Division of Pension & Retirement Accounts

Family Law Attorney for Division of Pension, Retirement and QDRO’S

Pension and retirement accounts are often overlooked and underappreciated by inexperienced attorneys, or attorneys who are unwilling to take the time to understand the terms of the specific retirement plan.

A defined benefit plan is typically a pension which pays an amount each month to the retiree based on a formula which considers years of service and earnings history before retirement.  Common defined benefit pension plans include TPMG (Plan 1), UCRP, STRS, PERS, ACERA and union-sponsored plans.  Many people are surprised to learn that pensions are routinely divided at divorce.  A qualified domestic relations order, or QDRO, is filed with the family law court and served on the pension plan.  The QDRO requires the pension plan to pay a portion of the monthly benefit to the non-employee spouse at retirement.

A defined contribution plan is typically a cash denominated retirement account, such as a 401k, 403b, or SEP-IRA.  These accounts may also be divided in-kind at divorce by QDRO.  The QDRO usually requires the non-taxable transfer of a portion of the retirement account to a rollover IRA in the name of the non-employee spouse.  If the non-employee spouse then decides to withdraw funds from the rollover IRA, he or she is responsible for all income taxes associated with the distribution.

The drafting of the QDRO, especially with respect to defined benefit pension plans, presents complicated issues which many attorneys do not fully appreciate.  Often, the terms of the specific pension plan govern which elections should be made and the appropriate terms in the QDRO.

If you or your spouse have a defined benefit pension or a defined contribution retirement account, you should make sure that your attorney understands the terms of the retirement plan and explains your options.  I can answer your questions and have many years of experience with all of the pension and retirement plans available in the Bay Area.

© 2000 - Law Offices of David D. Bunn All Rights Reserved.

Law Offices of David D. Bunn Powered by Communications Team