Florida Divorce: Qualified Domestic Relations Orders (QDROs) Explained

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Going through a divorce is never easy. Beyond the intense emotional aspects getting separated, untangling finances can also be extraordinarily challenging for many couples. This is particularly true for high-asset divorcing couples. Often high net-worth couples own many different types of complex property or assets that can be difficult to divide. One of the most prominent examples: retirement plans.

Retirement plans, which are often tax exempt and strictly regulated, can be difficult to access and divide. Here, our Clearwater complex divorce attorney discusses one common legal tool that is available to help many high-asset divorcing couples divide their retirement assets in a way that will allow them to avoid unnecessary financial costs and penalties: Qualified Domestic Relations Orders (QDROs).

What is a QDRO?

A QDRO is a specialized court order that allows a person to get access to a portion of their former partner’s retirement benefits. The primary benefit of a QDRO is that it is the most cost effective way to divide complex retirement benefits without unnecessary hassle, confusion or delay. Without a legally valid QDRO, divorcing couples will often run into one of the following three major problems:

  1. They will have simply ignored retirement benefits altogether, likely leaving one spouse with a smaller percentage of the couple’s total assets than they deserved;
  2. They will miss out on certain retirement benefits, such as spouse survivor benefits from a pension plan; or
  3. Their retirement benefits will be mishandled, possibly resulting in large tax penalties.

QDROs are Complex and They Must Be Individually Crafted

As QDROs often deal with retirement plans that are governed by complicated federal regulations (such as ERISA), all QDROs must contain certain required elements and meet certain legal standards. Yet, at the same time, QDROs should also always be customized. An effective QDRO will be individually tailored to the unique needs of the divorcing couple in question. What your QDRO will entail will depend on:

  • How many retirement plans you and your spouse have;
  • The nature of your retirement benefits and assets;
  • The intent behind drafting the order; and
  • How the retirement assets fit into the larger picture of your marital property.

In some cases, divorcing couples may simply have 401(k) accounts that need to be split. In other cases, one or more of the spouses may have a pension plan, for which partner survivor benefits can be paid out. Ultimately, you need to work with an experienced Clearwater divorce lawyer who can ensure that your QDRO is properly drafted so that you do not leave any benefits on the table and do not get any less than your fair share of the marital assets.

Get Florida Divorce Help Today

At the Law Office of Gale H. Moore P.A., we have extensive experience handling complex property division divorce cases. To learn more about how we can help you, please call us today at (727) 584-2528 to set up your fully confidential initial consultation. From our office in Largo, we serve communities throughout the region, including Clearwater, Saint Petersburg, Ozona, and Crystal Beach.

Resource:

dol.gov/sites/default/files/ebsa/about-ebsa/our-activities/resource-center/publications/qdros.pdf

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