What’s a QDRO?
QDRO stands for Qualified Domestic Relations Order. A QDRO is used to divide certain types of pensions and retirement plans. The Employee Retirement Income Security Act (ERISA) was passed in 1974 and under this act, certain benefits may only be paid out to the plan participant with a court order, a QDRO, dividing or assigning the benefits.
A QDRO is needed where there is a community property interest in a qualifying plan. Once the parties agree on how the plan is to be divided or the court makes an order about how to divide the benefits, a QDRO is prepared. It is filed with the court and signed by the judge. Then it goes to the plan administrator so that they can carry out the division or assignment.
QDROs must meet specific requirements in order to be carried out and can be complex. Some firms specialize in preparing QDROs and the retirement plan administrators sometimes offer sample language or a review to ensure that the order can be carried out.
Need help dividing retirement benefits as part of your divorce? Contact Romanovska Law to learn more.
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