Understanding QDRO In Texas Divorces
During divorce proceedings, retirement benefits may need to be divided. Only the retirement benefits that were accrued during marriage are available for division. For Texas divorces, a Qualified Domestic Relations Order (QDRO) is necessary to divide retirement benefits.
How Does a QDRO Work?
The QDRO is a court order that splits the eligible retirement benefits as of a specified day into two separate accounts. The court must issue an order to divide the retirement benefits.
In simpler terms, the QDRO makes it so a provider is ordered to make direct payments to the former spouse of an individual covered by their plan. The QDRO document must be submitted to the plan administrator and be accepted by such.
QDROs are always required when a divorce court awards part or all of one spouse’s retirement benefits to the other. There are several benefits to using one. This gives you control over your portion of your former spouse’s benefits. Also, without a QDRO you must depend on your former spouse to follow through with making the payments as ordered by the court. Also, the former spouse would be taxed on the distributions, so that there would have to be a tax adjustment to the payment. Most plans do not allow the spouse to receive benefits before the retirement of the spouse covered under the plan.
Having the assistance of an experienced attorney to draft a QDRO form based on your unique situation and needs is helpful to avoid delays in divorce proceedings.
Speak With An Experienced Attorney
Understanding QDROs can be complicated. A mistake could mean many months of delays. The experienced attorneys at Vaught Law Firm can help you with your property or asset division to ensure that your finances are protected. Fill out our contact form today or call us at (512) 342-9980 for a consultation.