How Are Retirement Plans Divided in a Divorce

What Is A QDRO?

A QDRO (Qualified Domestic Relations Order) is a decree or order to pay child support or alimony to an ex-spouse from retirement or pension funds. The QDRO may be part of a divorce decree or its own separate document. QDROs are not available for retirement plans not covered by the Employee Retirement Income Security Act (ERISA), such as military retirement; state, municipal, or federal retirement plans; and most deferred compensation plans.

All QDROs must contain:

The formal name of the plan,
The full name and last known mailing address of the participant, employee or contributor, and the “Alternate Payee” (spouse, former spouse, or other payees),
Social Security Numbers of both parties,
Participant’s plan identification number if different from the participant’s Social Security Number,
The amount or portion of the plan benefit payable to the alternate payee and the method to be used to calculate such amount, and
For a defined benefit plan, the duration for which the benefit is payable to the alternate payee.

How QDRO Portions Are Determined

The biggest factor in deciding how much a party is awarded is whether the participant was enrolled in the retirement program prior to the marriage. If the marriage existed before participation in the retirement plan, it is usually split 50/50 between the parties, beginning on the date the divorce action was initiated.

If the retirement plan pre-dates the marriage, the “Woodward formula” is often used to help determine share division, which is calculated by taking the duration of the marriage (in months) divided by the duration of the retirement plan participation (in months).

For example, if your ex-spouse has accrued $75,000 of retirement by working for his company for 15 years—or 180 months, and you were married for 12 years of that time before initiating your divorce—or 144 months, you would divide 144 by 180 to get 0.8, or 80%. This means that 80% of the retirement fund is attributable to the marriage. So you would multiply $75,000 by 0.8 to get $60,000. Then you would divide that in half to find out each party’s share: $30,000 each.

Getting Help with Your Utah Divorce Case

If you are looking into a divorce or getting a QDRO and need legal help, we’re here for you. You need to ensure you consult with a competent family law attorney that understands the legalities of divorce and retirement in Utah and will help put your mind at ease so you don’t get taken advantage of. At CoilLaw, LLC, Provo divorce and family lawyer Jill Coil knows how to advise you during a divorce to help you achieve the best settlement and/or result possible.

At CoilLaw we are ready and available to help you through your legal action. If you need legal advice concerning a Utah family law issue, call Jill Coil at CoilLaw LLC in Utah at (801) 939-6027 today.