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You will need a QDRO to receive benefits from retirement accounts

Other than the marital home, one of the largest assets that Louisiana residents have is their retirement accounts. In most cases, the portion of those accounts that was acquired during the marriage could be subject to division in a divorce. Under the Employee Retirement Income Security Act of 1974 (ERISA), a qualified domestic relations order (QDRO) will need to be issued by the court before any funds can be dispersed for the benefit of the receiving former spouse.

A QDRO establishes that an alternate payee -- in this case a former spouse -- has a right to some or all of the participant's funds from a specific retirement account. The QDRO does not have to be its own order since the appropriate language, details and provisions can be included in a divorce decree or settlement to be effective. However, most plan administrators will need a copy of it for their records, and if it is included in the decree or settlement, the remaining information will be part of the plan participant's file, which some Louisiana couples might not want.

All QDRO's must contain information that identifies the parties, the plan and the percentage or dollar amount to which the former spouse is entitled, along with how long payments are to last, if applicable. In some cases, there is already an order in place for a portion of the same retirement account, which may or may not be for the same person. A subsequent QDRO cannot interfere with another order. For example, if another former spouse already has a claim on a portion of the same account, the new QDRO cannot supplant that right.

Other rules apply to QDRO's, so it would be beneficial to involve an attorney in their creation even if the parties are negotiating their own divorce settlement. Furthermore, different plans might require different information or provisions to be included in the order. Discussing the matter with the plan's administrator prior to taking it to the judge for approval would be a good idea in order to avoid issues in the future.

Source: United States Department of Labor, "QDRO's -- An Overview FAQs", Accessed on Dec. 11, 2016

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