In New Jersey, married couples who seek a divorce will have their marital assets divided justly as it is an equitable distribution state. With that being said, spouses may request a qualified domestic relations order (QDRO) to receive a portion of their former spouse’s retirement benefits. In New Jersey, retirement plans are considered marital property, meaning the funds in a retirement plan are up for division in the event of a divorce. Individuals work hard to earn money to provide for themselves and their families. However, once they retire they will no longer have a steady income. Through years of working, individuals will earn retirement benefits from their employers. These benefits will be placed in a retirement plan for when an individual wishes to retire. Individuals do not need to worry about losing all of their retirement benefits when a QDRO is granted. They will still receive the full amount they are owed in benefits despite a QDRO. Under New Jersey’s domestic relations laws, a QDRO must comply with the Employee Retirement Incomes Security Act (ERISA). This act protects individuals with qualified retirement plans. If you wish to receive a portion of your former spouse’s retirement benefits, reach out to our skilled and trusted Monmouth County Property Distribution Attorneys who can help you request a QDRO.
What is a QDRO in a divorce?
Essentially, a QDRO is a legal decree that divides the assets of a retirement plan in a divorce. Individuals who seek this judgment must request it through the courts. A judge will analyze each party’s financial situation and conclude whether or not the request is reasonable. If granted, a judge will sign the order and spouses will become alternate payees. This means they have the right to receive a specific amount of their former spouse’s retirement assets. In certain cases, a QDRO is granted to cover expenses for child support, marital property rights, and alimony.
What types of retirement plans are included?
If an individual is granted a QDRO decree there are limitations to which types of retirement benefits they can recover compensation from. Generally, only qualified retirement benefits can be divided. This means individuals are only able to acquire portions of an individual’s retirement plans if it is covered by ERISA. Some retirement plans that can be divided include:
- 401 (k) plans
- 403 (b) plans
- 457 plans
- Employee stock ownership plans
- Profit sharing plans
- And any other plans covered by ERISA
What types of retirement plans cannot be included?
Certain retirement plans are not able to be divided by this decree. Retirement plans that do not comply with ERISA and are considered not “qualified” cannot be divided by this legal document. The following cannot be included:
- Deferred annuity plans
- Deferred contribution plans
- Government pension plans
- Military pension plans
- And any other plans that are not covered by ERISA
If you are seeking a divorce, don’t hesitate to contact an experienced and determined member of our team. Our firm is committed to helping our clients request a QDRO judgment to receive a portion of their former spouse’s retirement benefits. With years of experience, we are ready to fight on your behalf today.