Although a retirement plan is likely the largest asset in your marriage, it may be overlooked during a divorce. If you lack the right court order to divide a retirement plan, you may lose a significant amount of your assets in case of a divorce in North Dakota. Thus, you might find yourself at risk of economic insecurities during retirement.
A qualified domestic relations order, or QDRO, is a court order that will grant you the rights to a share of your spouse’s retirement benefits if you have participated in an employer-sponsored retirement plan. Although QDROs are prepared during the divorce proceedings, they can be filed after the divorce.
Why do you need a QDRO?
According to federal laws, retirement benefits can be divided between divorcees only when there is a QDRO. Thus, a divorce decree issued at a state court may not be enough. While it is possible to obtain a QDRO after the divorce, it is advisable to obtain the order during the division of property.
If a participant passes on before the QDRO is filed, the plan will have a harder time rejecting it, but the order needs to be consistent with the terms of the plan. Additionally, if a participant retires after the finalization of the divorce and no QDRO has been filed, the participant will be paid the benefits, not their ex-spouse.
How to obtain a QDRO
During a divorce, ensure that your attorney accounts for all your retirement assets. Let them know that a QDRO will be required. If you have no attorney, contact the local bar association. You can also notify the court that your spouse has retirement benefits. Your spouse will be required to provide the required information for the equitable distribution of the benefits.
What should a QDRO include?
There are basic elements that each QDRO must contain. Below are the key requirements:
• Name and mailing address of the participant
• Name of each plan
• The dollar amount
• Number of payments
If you have a QDRO, you should submit it to the plan immediately. If you encounter problems with it, a lawyer may be able to assist you.