Frumkes & Vertz on Divorce Taxation §13.12 Qualified Domestic Relations Order Checklist Does the court-issued order clearly appear to relate to the allowance of child support, alimony payments, or marital property rights to a spouse, former spouse, child or other dependent of a participant? Does the order clearly appear to be made according to a […]
Becoming proficient in identifying, valuing and dividing retirement benefits is one of the most important skills a family lawyer can develop, as these are frequently among the most valuable property in a divorce. Qualified retirement benefits are tax-deferred assets whose net value is less than their face value. A qualified domestic relations order (QDRO) is a form that permits spouses or former spouses to divide ERISA retirement benefits, like 401K plans, without immediate income tax consequences. Family lawyers must treat retirement assets as a separate class of property (or determine their after-tax value) when dividing marital or community property to avoid doing injustice, and it is equally important to make smooth transfers between spouses or former spouses without triggering tax liability inadvertently or imprudently. In Frumkes & Vertz on Divorce Taxation, we have devoted three full chapters to this subject, covering QDROs, qualified retirement plans, municipal plans, and IRA accounts.
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