Carton & Rosoff PC-Attorney at Law

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How 401(k) accounts are divided in a divorce

Throughout a marriage in New York a couple may acquire many different assets. The longer the couple is married, the more assets they can acquire. The assets can come in many different forms as well. The couple may have multiple properties, have large retirement accounts, investment accounts, vehicles, collectables, businesses and other assets. If the couple divorces, the assets that the couple acquires during the marriage will need to be divided.

This can be a complicated process, especially in high asset divorces. This is because not only does the couple have a large number of assets, as stated above, they come in many different forms and each type of asset requires different procedures to divide them. For example real estate must be appraised to determine the value before the couple can divide the asset. Also, other types of assets require special procedures to divide them like retirement accounts such as a 401(k).

When dividing a 401(k) first the marital value of the account must be determined and then that portion must be divided equitably. Determining the total amount each spouse will receive can be the easier part of the process. After the amount is determined, a separate order called a Qualified Domestic Relations Order must be signed to order the account to be divided. After this order is complete, the spouse receiving the money from the account must determine how they would like to receive it. They could decide to roll it over into their own retirement account, take the money out or defer distribution until retirement.

There are certain aspects of divorces in New York that not every couple will have to resolve. If the couple does not have minor children, child custody and child support will not be an issue in their divorce. However, every couple will need to divide assets. How difficult this process is depends on the number and type of assets that the couple owns. Often times high asset divorces tend to be more complicated and experienced attorneys understand the complexities of these divorces.

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Carton & Rosoff PC
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