Qualified Domestic Relations Orders in Oklahoma
There are 62 million private wage and salary employees in the United States who receive retirement benefits from their employers. If married, such employees share those benefits with their spouses. But if they divorce, they may also have to divvy up the assets from their retirement plans. Learn more about QDROs and how they work when it comes to an employee’s assets.
Entz Burton & Associates, estate planning lawyers, have assisted Oklahoma families and family-owned businesses with estate planning and business law for over 30 years. Reach out to us today to schedule your free consultation and learn about QDROs and other financial issues.
What is a QDRO?
A QDRO is a Qualified Domestic Relations Order. It’s a decree, order, or judgment for an employee’s retirement plan to pay alimony, child support, or marital property rights to a current or former spouse, child, or another dependent.
Having a QDRO in place could be an important part of the asset protection or estate planning process. Employees wants to make sure that in the case of divorce, for instance, they will receive a fair share of their spouse’s retirement benefits.
When is a QDRO Prepared?
A QDRO typically comes into play when a couple is getting divorced.
When prepared, a QDRO can take into account the fact that both parties worked hard in the marriage, whether via employment or raising children.
A more amicable divorce will result if partners agree on the terms to be included in a QDRO. Both parties will be able to plan better for their financial futures if it is known what and how much they are to receive.
With assistance from an estate planning or asset protection lawyer, you can ensure you and your family will benefit from a properly prepared QDRO. You can contact Entz Burton & Associates for help with your QDRO.
Obtaining a QDRO
In order to be valid, the QDRO must contain the right information, like the retirement plan participant’s name and last known mailing address, along with the name and last known mailing address of any payees. It also needs to contain the percentage or amount of the participant’s benefits that will be paid to each alternate payee.
Both parties and a judge will need to sign the QDRO. Most of the time, the divorce judgment will order both the employee and his or her spouse to obtain a QDRO in order to split retirement benefits.
How QDRO Taxation Works
If a QDRO distribution is paid to a child or dependent, then the plan participant will have to pay the taxes. Under IRS rules, “An individual may be able to roll over tax-free all or part of a distribution from a qualified retirement plan that he or she received under a QDRO.”
It’s best to consult with an asset protection or estate planning attorney to figure out how to avoid losing out on benefits to taxation.
Contact a QDRO Attorney at Entz Burton & Associates
If you need help with QDROs, then get in touch with Entz Burton & Associates today for your free consultation. Call us at 405-773-9800 or 800-633-7230, or contact us on our website. We look forward to helping you with all your asset protection and estate planning needs.