What is a QDRO?

Donald F. Conviser, a Certified Family Law Specialist, 818/880-8990, owner of Warner Center Law Offices in Woodland Hills, California, serving Family Law and Divorce clients in Los Angeles and Ventura counties for over 35 years, offering a free confidential consultation regarding your divorce or family law problem or concern, writes in his Family Law blog:

Today, a divorce client asked me a pertinent question: What is a QDRO? I'll share my answer with my readers. A QDRO (Qualified Domestic Relations Order) is an order in a divorce case that deals with pension, retirement, 401K or similar deferred income plans covered by ERISA, the Employee Retirement Income Security Act of 1974, federal legislation which was enacted to ensure uniformity in orders transferring interests in or funds from such plans.

A QDRO must follow the requirements of ERISA and Internal Revenue Code Section 414(p), as well as the guidelines set up in advance by the plan administrator.

The person whose interest (or a portion thereof) is being transferred is the "Participant", and the person to whom the interest is being transferred is the "Alternate Payee."

QDROs can be used for dividing pension and other deferred income plans, as well as for distribution of child support and alimony to a spouse, former spouse, child, or other dependent of a plan Participant.

Significant adverse income tax consequences can occur if plan benefits are transferred or distributed without a properly drafted QDRO (signed into an Order by the divorce Judge) where ERISA requires a QDRO.

Most pension plans covered by ERISA will not permit transfers or distributions to an Alternate Payee without a QDRO that has been pre-approved by the plan administrator.

Written by Los Angeles divorce lawyer Donald F. Conviser, of Warner Center Law Offices, a Certified Family Law Specialist with over 35 years of Family Law Experience. For a free confidential consultation, call 818/880-8990.