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Do you need a QDRO as part of your divorce?

Your and your soon-to-be ex-spouse’s retirement accounts are probably some of your more valuable assets. Like with your home, vehicles, savings accounts and other marital property, you must divide retirement funds during your divorce. 

If you cannot reach an acceptable agreement with your husband or wife, a Delaware judge is likely to apply principles of equity when deciding what to do with your retirement accounts and other marital assets. Either way, you likely need a qualified domestic relations order as part of your divorce. 

What is a QDRO?

A QDRO is simply a legal order that tells the retirement plan administrator what to do with funds in the retirement account. That is, the QDRO names an alternate payee who has a legal right to receive all or some of the account benefits. In the First State, a QDRO may also be necessary to redirect benefits to cover spousal or child support. 

Why do you need a QDRO?

Retirement plan administrators must follow specific rules when paying benefits. Even if your divorce decree or settlement agreement lists you as a new beneficiary, the administrator must have a QDRO on file. Otherwise, the administrator is likely to refuse to pay you the benefits you deserve. 

What does the QDRO say?

To be legally enforceable, a QDRO must have precise legal language. The QDRO must also comply with the requirements of the retirement plan. Typically, an experienced attorney drafts the document and submits it to the judge for approval. 

You do not want to lose out on your share of retirement benefits. Because a QDRO requires technical language, you must devote considerable attention to getting the wording right.