Qdro Sample
Cori Lenon
I'm a retirement actuary. Nothing about my comments is intended or should be construed as investment, tax, legal or accounting advice. Occasionally, but not all the time, it might be reasonable to interpret my comments as actuarial or consulting advice.
What about situation where divorce decreee is entered generally discussing wife's right to receive a benefit under the husband's defined benefit plan by filing QDRO with the court. Discussion is not specific enough to constitute a QDRO. Wife dies shortly thereafter without ever getting QDRO. Plan Administrator cannot honor the original decree language because it is not a QDRO nor any later QDRO issued to deceased wife or wife's estate because deceased spouse is not one of the categories of parties for whom QDROs can be issued.
Mine situation is part story, part question. An ex-husband (unemployed) received part of his ex-wife's plan balance. We have not made distribution yet because we are in the 60 day "objection" period. He has already fallen behind in child support payments. A DRO can be issued for part of his money still in the plan can't it for child support?
I gave a sample QDRO to the spouse of a participant, she needed it to take to her attorney. She brought it back for us to look at. It read exactly as the sample we gave her "......._____________________ (enter participant's name here)......". He charged her to correct it, so that it would include participant name, address, social security number, alternate payee name, etc etc - you know the basics. It was still wrong so we fixed it for her. No charge-she'd been through enough.
Been reviewing and re-reviewing a proposed DRO for a participant in a DB plan out on disability. The plan provides that a participant who is entitled to a disability retirement pension under the Social Security Act will be entitled to apply for a disability retirement pension under the plan commencing as of the first day of the month following or coincident with the date his disability pension from Social Security commences. The plan does not specify whether payments will include payments back to the date of disability determination. Although the participant went out on disability back in May, it can take quite a while to recieve a determination from Social Security and for benefits to commence. During this waiting period, the participant dies without proper language in the DRO naming the alternate payee as the surviving spouse for purposes of the QPSA, although it is his intention to provide her with this protection. We are trying to determine whether there is way that we can consider his benefit to have started as of the date Social Security determines that he was disabled, even though payments won't actually start under the plan until his Social Security benefits start.
Check this out, the QDRO stated the Alt payee would receive an acutal dollar amount from the participants regardless if he took it early. He decided to take it early (reduced by 50%) and her benefit was UNREDUCED because it was an actual dollar amount! It was qualified.....
If alternate payee was enough older than participant such that $200 monthly payment just happened to be precisely actuarially equivalent to $200 deferred normal retirement payable to participant, then it would all work out and no overpayment took place. I think I just saw an angel dancing on the head of a pin, though.
An IRA owned by a decedent designated his ex wife as the bene before they were divorced. Decedent did not change designation after divorce. Decedent was a resident of Hawaii which provides that upon divorce spouse beneficiary designation is automatically revoked. After IRA owner's death the ex spouse requested a distribution based on bene designation. Spouse received the IRA proceeds and rolled it over to her own IRA before executor for H's estate found out.
I was looking in particular for horror stories such as in a case where the plan administrator improperly rejects a DRO as a QDRO. I'll give you one example. The DRO said the name of the plan was the XYZ Partner's Plan. The plan administrator (or its agent) - a very prominant benefits consulting firm with offices in just about every major city in the US - came back and said, "Nope, the name of the plan is the XYZ Partners' Plan - no QDRO." The AP's choices were (1) go back to family court to get a new DRO with the name XYZ Partners' Plan, (2) commit fraud by using whiteout, or (3) sue the plan administrator for a declaratory judgment that the DRO qualified. (As most of you know, the DOL will rarely help with QDROs, if ever). The best option is (1), but required filing a new motion, serving the other side with process, going to a hearing and fighting about every argument the participant tried to raise, and court fees and attorneys fees out the proverbial wazoo - for absolutely no reason. (This was not my case, but I was shocked when I heard about it.)
If you have not seen it, See Keen v. Weaver, 2003 WL 21467100. If the waiver is specific, knowing, and voluntary, then it is effective (at least in my circuit) and, assuming there are no contingent beneficiaries, you fall back to the plan document.
Here is the next question. If the plan gives the PA discretion, is the standard of review for the PA's determination that the waiver is (or is not) specific, knowing and voluntary a de novo standard of review or abuse of discretion? If the PA is interpreting the divorce decree, then possibly de novo. If the PA is finding facts, depending on the circuit, then possibly abuse of discretion.
Texas is a community property state, so any COAERS benefits you earn during marriage may be divided by a court in a divorce proceeding. If, during a divorce proceeding, it is determined that you will keep 100% of your COAERS benefit, we do not need any paperwork from you. However, if it is determined that you and your spouse will be dividing your COAERS benefit, you will need to submit a Qualified Domestic Relations Order (QDRO). A QDRO is a special legal order which is signed by the judge who has jurisdiction over your divorce. It tells us what portion of your retirement contributions or monthly retirement benefit to pay to your spouse and the form of payment (lump sum or annuity) after your divorce is final.
For COAERS to pay benefits to a former spouse (also called an alternate payee), the QDRO must meet specific requirements. QDROs that do not meet COAERS requirements will not be honored, which could result in delays and additional legal costs. A sample QDRO form is available below for attorneys to use to draft the QDRO correctly. It is strongly recommended that you or your attorney present the QDRO to us prior to the finalization of your divorce.
If you are a retiree receiving a monthly benefit payment and we receive a court order for child support signed by a judge that qualifies as a QDRO, we will deduct child support payments from your monthly benefit payment. COAERS will not deduct child support payments under a court order that does not meet the requirements to be a QDRO.
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WRS has formal rules regarding divorce settlements. WRS requires a Qualified Domestic Relations Order (QDRO) signed by a judge to split your retirement benefit between you and your former spouse. If your former spouse is awarded a percentage of your benefit, your monthly retirement benefit will be reduced for your lifetime, even if your former spouse elects to be paid in a lump sum.
The Wyoming Retirement Board has established rules relating to QDROs that outline the minimum requirements needed for qualification. A sample QDRO with board-approved language is available. A separate QDRO is required to divide assets in the WRS 457 Deferred Compensation Plan.
A disbursement must be made to the alternate payee immediately, either in a lump sum payment or a monthly retirement benefit. Benefits are paid according to the amount, type, form, and options otherwise available under the retirement system. Joint survivor benefit options are not available to an alternate payee.
If the alternate payee dies before retirement benefits have begun, all benefits awarded revert to the member; the alternate payee does not have the option to designate a beneficiary.
A benefit based on a medical or disability retirement cannot be divided unless the member is of retirement age.