QRDOs: How Retirement Accounts are Handled in a California Divorce

Although you may not be able to receive benefits from your pension plan until you reach your retirement age, your plan can usually be divided into a divorce process long before your retirement. California courts can split pensions and other pension plans just as you and your spouse can split other types of property. Pension plans, however, may require additional paperwork to split them legally.

Separate Property vs. Community Property

In California, property owned by you or your spouse before your marriage is considered separate property, which means that when you divorce, if you owned it before you marry, it is generally not divided. You made pension contributions before or after your marriage as your separate property. But contributions you made during your marriage are considered by your divorce court as community property.

Therefore, if you worked in your pensionable job for 10 years before your marriage, you will generally be able to keep the contributions you made and the benefits you earned over that 10-year period.

Agreements and Experts

Pensions can be complex, especially if you try to set premarital contributions values or predict the future value of the existing pension. You may therefore want to hire a pension expert to help you understand your pension’s potential value and division.

With or without the assistance of an expert, you and your spouse can reach an agreement on how to divide your pension. For example, your spouse may exempt your pension from any rights she may have. If each of you and your spouse has a pension, each of you can agree to keep your own pension and waive any rights you may have to the pension of the other spouse.

Pensions as a Party to the Case

In your divorce case, some pension plans have to be “joined” as a party. The court can not issue rulings dividing the benefits of the plan without this joinder, but not all types of plans need to be joined. California Form FL-318-INFO lists categories of plans to be included as divorce parties. For example, you don’t need to include federal government pension plans in your divorce case, but state plans do.

QRDOs

Only a Qualified Domestic Relations Order can split some pensions, the court order explaining the details of the split. These orders must meet specific legal requirements to be valid, including approval by the judge and the provider of pension benefits. As QDROs can be very complicated, there are no standard forms of court in California that fill this requirement. For instance, QDROs in general.

Contact an Attorney

At the Law Offices of Kayleene H. Writer, PLC, we are passionate about helping people while they are going through their difficult family law situation. We would love to talk to you about how we can help you. Just contact us online or give us a call today at (415) 805-9069.