Understanding the Division of Retirement Accounts in Divorce
How do retirement accounts get divided in a divorce? My name is Carl Birkhead. I’m an attorney with Wirth Law Office in Tulsa, Oklahoma. I’ve been practicing family and criminal law for about seven years now, and I want to help you make law easy by talking a little bit about how retirements play into divorce proceedings and how they get divided out.
So, this comes up, not every divorce case, but it comes up often enough to shoot a video about it. When and how do we divide retirement accounts? It’s handled by statute. I mean, absent extenuating circumstances, a spouse is entitled to half of the retirement that’s accrued by their spouse during the pendency of their marriage.
How Retirement Accounts Are Evaluated
So, I’m just going to, for even numbers, let’s say you and your spouse get married and they’ve got $200,000 in their retirement account, and you’re married for five years, and they get another $50,000 in that account. You don’t get to split $250,000. That’s not how it works. If $50,000 is what accrued during that marriage, that’s what you’re going to split. You’d be splitting that $50,000, which $25,000 is nothing to snub your nose at. That’s still a good chunk of change.
But I’ve seen plenty of cases where the clients want to go after the whole pie, and unfortunately, they really can only go after that one piece. Now, let’s say maybe you’ve got a retirement account and your spouse has a retirement account, and they’re roughly the same. More often than not, the court’s not going to touch them there.
The Role of Qualified Domestic Relations Orders (QDROs)
Strictly speaking, yeah, you can split the baby both ways. You get half of his, you get half of hers. Or you can save yourself a lot of time, save your attorneys a lot of paperwork and headache, save yourself the fees that go into it, and just not even mess with your retirement accounts. You keep yours, you keep yours, everyone’s happy.
How do these accounts get split? In these situations, after the courts issue an order to divide an account, or after you’ve reached a settlement agreement, and as part of that agreement, dividing the accounts is part of the terms of the agreement, your attorney is going to draft up and issue what’s called a Qualified Domestic Relations Order, or a QDRO.
What to Do if You Have Questions
A lot of times, they’ll have you go to wherever your retirement is, like whatever company is holding it. They’ll have forms that they prefer to use. If they don’t, your attorney will draft it up for you, make sure that everything is put in properly, the proper amounts, the split, whether it’s going to be a lump sum payment, whether it’s going to be paid over months, or whether it’s going to have to wait and sit until you start drawing off your retirement.
All of that gets addressed in the QDRO, and that QDRO is ultimately going to be filed with the court, usually separate from the divorce decree. More often than not, it gets filed after the decree is done. If you have questions about this, or you’re just kind of not sure about how your specific retirement account is going to play into your divorce, give us a call.
Schedule a Low-Cost Initial Strategy Session
I’m family law attorney Carl Birkhead Wirth Law Office and want to help you make law easy. Reach out today to schedule a low-cost initial strategy session to discuss your retirement account division during divorce proceedings. Call us at 918-879-1681.
