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ARTICLE · 28 JUNE 2010

DOL Issues Final Rules on Timing, Ordering of Domestic Relations Orders

McGuireWoods LLP
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On June 10, 2010, the DOL issued final regulations on the timing and ordering of domestic relations orders (DROs).

United StatesEmployment and HR
Robert Cipolla
Robert Cipolla
Robert Chambers
Robert Chambers

On June 10, 2010, the DOL issued final regulations on the timing and ordering of domestic relations orders (DROs). The rules provide helpful guidance, primarily through examples, in clarifying several issues that have confused plan administrators, participants, and alternate payees for years. The final regulations will become effective August 9, 2010.

Background

Under the Internal Revenue Code and ERISA, a participant's benefit in a qualified retirement plan may not be assigned or alienated, except in very limited circumstances. One exception is that a retirement benefit may be assigned to the participant's spouse, former spouse, child, or other dependent (alternate payee) pursuant to a legal order as a result of the participant's divorce or separation. These orders are known as qualified domestic relations orders (QDROs).

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