Especially if you are divorcing after a number of years of marriage, your retirement funds and 401k balance may be one of the biggest assets that you share with your spouse. More importantly, your retirement funds also represent the secure future you have been planning for – and even though your future may not be shared with your spouse as you had believed, you are still legally entitled to part of your retirement money.
A number of different retirement plans and funds could be affected by your Washington State divorce, including:
• 401K plans and 403K plans
• IRAs and Roth IRAs
• ERISA funds
• Pensions and military pensions
• Employee Stock Option Plans (ESOPS)
Even if only one spouse is contributing to these retirement plans, both spouses could be entitled to part of the money accumulated in the plans.
When dividing retirement plans, there are two basic avenues to take: buying out the account at its present day value and dividing the account into two separate accounts. The latter avenue is the more common one, as it does not incur taxes and penalties, and involves a Qualified Domestic Relations Order (QDRO). A “Quadro,” as they are called, is a domestic relations court order that recognizes the existence of another person’s right to receive all or a portion of the benefits in a retirement plan and allows the retirement funds to be allocated without the associated tax penalties and fees.
If you are going through a divorce and are worried about getting your fair portion of your retirement funds, talk to a Washington Divorce Lawyer today.