Q. Henry D. of Michigan wants to know: "Is a QDRO the Only Way to Receive All or a Portion of a Spouse's Retirement Account?"
Evan, from the QDRO Department of Pension Evaluators & QDROS Of Troyan, Inc Associates Group responds: "Yes. All or part of your retirement plan will be transferred to your spouse only if the transfer is made under a qualified domestic relations order (QDRO).
To qualify as a QDRO, all of the following criteria must be met:
1. The instrument must be a judgment, decree, or order of a court (including an approval of a property settlement agreement) that
- Addresses marital property rights of your spouse
- Is made pursuant to your state domestic relations law or community property law.
2. The domestic relations order must create or recognize the existence of an alternate payee's right to receive, or it must assign to an alternate payee the right to receive, all or a portion of benefits payable to you or payable on your behalf.
The QDRO must not:
1. Require the plan to provide any type of benefit or any option not otherwise provided for in the plan
2. Require the plan to provide more benefits (determined on the basis of actuarial value) to the alternate payee than you would be entitled to require the plan to pay one alternate payee benefits that are required to be paid to another alternate payee under another order previously determined to be a QDRO.
The QDRO must clearly specify all of the following information:
- Your name, your last known address and the name and mailing address of each alternate payee covered by the order
- The amount or percentage of your benefits to be paid by the plan to each alternate payee or the manner in which such amount or percentage is to be determined
- The number of payments or the period to which the order applies
- The name of each plan covered by the order.
- At Troyan we follow state by state case law to identify the personal identifiers only to the Plan Administrator and not the State Court, unless mandated.
- A plan administrator is required to determine whether a domestic relations order is a QDRO within a reasonable time after the receipt of the order and is required to notify you and each alternate payee of the determination as per ERISA guidelines. Every qualified plan is required to have written procedures for making these determinations, and these written procedures should be available to you."
Evan Edelstein
Lead QDRO Analyst