The big questions come at couples at a fast and furious pace in divorce. Disputes over matters such as child custody can be difficult to resolve. So, too, can disagreements over how to divide assets, including retirement accounts.
Sometimes people fail to realize that the nest egg can be a couple’s greatest financial asset. That is why it is so important to have an attorney who understands that in many cases, your 401(k) and other retirement funds will be considered marital property to be split equitably and knows also how to ensure that your interests are protected.
According to a survey of members of the American Academy of Matrimonial Lawyers, disputes over retirement assets are high on the list of common disagreements in divorce.
According o the survey, the three most common financial disputes are over spousal support/alimony (83 percent), retirement funds and pensions (62 percent) and business interests (60 percent).
Something worth remembering about the top spot on the list: spousal support will no longer be tax deductible for the paying spouse after this year. Alimony will also not be taxable income for the one receiving it.
Few folks without legal training know what QDRO stands for. It is simply an acronym for a Qualified Domestic Relations Order — an important term for someone facing divorce involving retirement assets.
A QDRO is often used to gain access to a rightful share of a spouse’s work retirement accounts such as a 401(k) or pension plan. A recent article on retirement funds disputes in divorce says, “Because these court orders are a specialized legal area, make sure the attorney who drafts it has some expertise.”
No matter the type of retirement assets you or your soon-to-be-ex has, it is important to discuss the details with a family law attorney experienced in obtaining favorable resolutions in complex property division disputes.