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Orders required to divide retirement accounts in a divorce

High-asset divorces can have many more complications than those with fewer assets. The more people have, the more they need to divide. Oftentimes simply valuing the property people own can be a complicated and time consuming process, and they may need various professionals to assist in the process.

People may own multiple properties, expensive jewelry, collectables, motor vehicles, investment accounts or businesses. Oftentimes forensic accountants, various appraisers and others are needed to determine the value of all of these assets, as the value generally is not immediately clear.

People with many assets may also have retirement accounts, such as 401(k)s, with a significant amount of money in them. These are assets like other savings accounts that need to be divided during the divorce. However, while the value may be easy to identify, a special order is needed to actually divide them, adding another complication to the process of dividing the assets.

These retirement accounts are governed by ERISA and the IRS, and a Qualified Domestic Relations Order, or QDRO, is needed to divide them. The divorce decree is governed by state law, but the retirement accounts by federal law, so the couple needs a QDRO that conforms to the specific language in the federal statutes.

Many people in New York divorce each year. Each of these divorces are unique and present their own complications. High-asset divorces present complications that other divorces may not have. One of these complications is that in order to divide retirement accounts, a separate order will need to be drafted and signed to actually divide the money in the account.

Source: United States Department of Labor, "QDROs: The Division of Retirement Benefits Through Qualified Domestic Relations Orders" accessed on Aug. 15, 2016

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