Q. Jeanine M. of Michigan wants to know: "What is a DRO?"

A. Evan, from the QDRO Department of Pension Evaluators & QDROS Of Troyan, Inc Associates Group responds: "A "DRO" is an acronym for Domestic Relations Order. A DRO is a court order that requires a retirement plan or plan participant to pay a portion of the retirement benefits of an employee or retiree (who is called the "participant") to the participant's spouse, former spouse, and/or dependent children (who are each called an "alternate payee"). In other words, DROs are similar to QDROs as described above, except DROs apply to non-qualified deferred compensation plans (for example, stock options) and retirement plans which are only provided to executives of corporations. Also, the tax effects of a QDRO (as described above) do not usually apply to DROs."

Evan Edelstein

Lead QDRO Analyst