Solve Your Divorce-Related Retirement Issues with Help from Our Team
How to resolve matters related to pensions and other retirement plans when going through a Virginia divorce can be a major issue. Retirement savings plans and pensions may comprise one of your most valuable assets and an asset you have been building for decades.
This issue then becomes one that can dramatically affect your financial resources going forward. Thus it becomes an extremely important issue when going through a divorce and calls for the services of an attorney who is well-versed in the matter.
At Tobias Iszard, we have significant experience in handling retirement account issues involving:
- Federal thrift savings plans
- Military pensions
- Other pension plans
Our Manassas retirement lawyers understand the critical importance of getting it right in your divorce when so much is at stake. Through their years of handling and litigating issues related to these plans, they have gained a wealth of knowledge that will be applied to your case.
If you are facing a divorce and your retirement is part of the overall marital property division issue, we are here to provide you with the legal advocacy you need to resolve this matter in your best interests.
In general, employer-based private retirement plans, such as 401(k)s or pension plans, are subject to marital property division between the spouses when going through a divorce. The ultimate transfer of these funds is generally done through a Qualified Domestic Relations Order (QDRO) which is entered by the Court after the divorce is finalized, but determining what amount is to be divided is an issue during the parties’ divorce.
In these scenarios, one spouse has paid into the retirement account generally through his or her employment. For the other spouse to receive a portion of the plan or pension’s benefits after a divorce, certain legal actions must be taken.
Qualified Domestic Relations Orders (QDROs)
The QDRO will instruct a spouse’s pension plan administrator on what percentage and how to pay shares of the plans’ benefits to each spouse after divorce. The spouse who does not own the account should not assume that he or she has an automatic right to these retirement funds merely because of marital property distribution laws in the state.
This spouse typically needs to have a QDRO drafted after the divorce proceedings in order to receive these benefits. Without a QDRO, the plan’s administrator would not be obligated to provide payment of benefits to this spouse.
QDROs must be approved by the court and the plan administrator to be effective and distribute the retirement assets. Furthermore, they apply only in cases where the retirement plan is IRS tax-qualified; these types of plans fall under the federal Employee Retirement Income Security Act (ERISA).
Federal thrift savings plans fall under the Federal Employee Retirement System Act of 1986; these plans also require a court order for benefits to be divided in divorce. Dividing an IRA also differs in procedure. Military or other government pensions are covered by other statutes.
The division of retirement accounts through divorce can result in unintended tax problems and loss of otherwise eligible benefits and protections if not handled correctly; for this reason it is best to rely on one of our Manassas retirement lawyers to ensure that your case receives the knowledgeable oversight that is needed.
Call today to get started on your case.
Dividing military pension benefits are subject to special procedures that differ from retirement accounts and benefits accrued through private employers. Special conditions and requirements pertain to division of military pensions.
For example, when a Virginia court issues an order to divide military pension pay as a result of a divorce, certain conditions must be met by the non-military spouse before he or she can receive a share of the military member’s pension directly from the Defense Finance Accounting Service (“DFAS”).
Generally, those conditions include that the spouses were married for at least 10 years, that the military spouse served in the military for at least 10 years, and that a minimum of 10 years of that service took place during the marriage.
DFAS, which administers distribution of military pension payments, is the agency that can then dispense benefits to the non-military spouse. Exceptions to the required conditions may occur in some cases. However, these would be governed by the court and would generally involve the payments made to the non-military spouse directly from the military member.