Michael E. Byczek, Attorney at Law

		QDRO (Qualified Domestic Relations Order) Retirement accounts are marital property and each spouse has a legal right to share in these financial assets. However, a divorce by itself does not grant a spouse the right to receive payments from the husband’s or wife’s pension plan. A QDRO is a separate document that is approved by a court and grants one spouse (alternative payee) the right to receive all, or a portion, of a pension plan. QDRO’s are often more complicated than the divorce itself. If uncontested and all documents are signed without too much delay, your divorce may be finalized three weeks after the contract is signed. However, QDRO’s may take months to approve. Unlike a property distribution, the two spouses will be bound to each other for life pursuant to monthly payments received from the retirement plan. In fact, the QDRO drafting phase may cost more in legal fees than the divorce itself. There are three ways to handle pension plans during a divorce: (1) both spouses waive their right to each other’s retirement accounts, (2) devise an offset, such as waiving a QDRO in exchange for an extra $5,000 worth of property, or (3) a full-blown QDRO arrangement. QDRO’s are complicated for two reasons. First, the attorneys are not in control. During a divorce, the attorneys on both sides can discuss the case and work out a settlement. However, a QDRO must be approved by the pension plan administrator. The attorney must communicate with the company to gather details, work out an approved draft, go to court, get a certified copy of the order, and go back to the administrator for further approval. This process may take months. The administrator has discretion to reject a QDRO that does not conform to internal protocols. Second, it is often very difficult for a divorcing couple to agree how to share the benefits. What if the husband built up his retirement for 20 years prior to marriage? The couple were only married two years, and the husband doesn’t plan to retire for another 20 years. How much money is the wife entitled to upon his retirement? This question involves detailed calculations and formulas that are more tedious than the divorce itself. Both federal and state law is used to determine an equitable distribution. Sometimes, the attorney must use subpoenas or interrogatories to gather this information. QDRO’s only apply to private pension plans, not to social security, government or military benefits, or IRAs (Individual Retirement Accounts). Additionally, public retirement systems in Illinois require a QILDRO (Qualified Illinois Domestic Relations Order) instead of a QDRO. Some divorces require expert witnesses, tax advisors, and financial analysts to fully examine how to divide retirement plans. Yet, the divorce itself was uncontested and only took three weeks start-to-finish. QDRO’s are so complicated, that this hearing is sometimes postponed until after the divorce is over. Michael Elliot Byczek will work with you to arrive at a preliminary assessment of your financial rights in retirement plans. Your decision how to proceed (i.e. waiver, offset, or QDRO) will determine how Michael can help you through the remaining steps of obtaining a divorce. Copyright © 2008-2009. Michael E. Byczek. All Rights Reserved.