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ARTICLE · 11 APRIL 2017

Be Prepared For Your Next — Or First — QDRO

With an estimated U.S. divorce rate in the 40% to 50% range, your retirement plan is likely to receive an order from a court directing the plan to split a participant's benefits, also known as a domestic relations order.

United StatesEmployment and HR

With an estimated U.S. divorce rate in the 40% to 50% range, your retirement plan is likely to receive an order from a court directing the plan to split a participant's benefits, also known as a domestic relations order. These orders entitle an "alternate payee" to a portion of your participant's retirement benefits. However, it is up to the plan sponsor or administrator to determine whether the order is qualified, making it a qualified domestic relations order (QDRO). Even though it is issued by a government entity (the court), it must comply with your plan's terms.

Spotting Common Errors

Here are some common reasons plan sponsors will fail to qualify a domestic relations order:

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