QDRO and 401K - Talk About Marriage
Considering Divorce or Separation If you're considering divorce or separation, this is the place to talk.

User Tag List

LinkBack Thread Tools Search this Thread
post #1 of 4 (permalink) Old 02-14-2013, 04:45 PM Thread Starter
Registered User
Join Date: Feb 2013
Location: Clayton, NC
Posts: 13
Question QDRO and 401K

For a separation/divorce how does a QDRO work?
I've got about 115k currently in my 401K
28K of it is in loans.

I'm planning to separate in the next few months. I'm looking for a new place to live now.
What are the options for the 401K?
I plan to move out and leave her the home once the streamline is completed. This will reduce the monthly payment about 300
I need to find a roommate to split an apartment with, otherwise I can not afford it
For my 401K, I heard I need a QDRO. So if I take the 115K and divide it by 2. That's 57500 she will recieve.
This QDRO stops the penalty for her correct?
Can I give her the 57500, and state she needs to give me 14K of it for 1/2 of the loans?
Can I disburse my 401K 100%, and make her give me 1/2 of that. This would allow me to obtain a place of resident's and remove any financial burdens with the divorce
And she can also do the same with her half.

I know wiping one's 401K plan is not a good option. But if it is possible it will relieve the financial burden associated with a divorce.

BlueDragon is offline  
Sponsored Links
post #2 of 4 (permalink) Old 02-14-2013, 11:25 PM
jd08's Avatar
Join Date: Nov 2012
Location: North Carolina
Posts: 303
Re: QDRO and 401K

A QDRO or qualified domestic relations order is used to divide a pension or 401k.

First you (or she since she's getting the money) would need an experienced attorney to draft a QDRO. They are highly technical documents and shouldnt be attempted without legal help.

Second, how the loan balance is treated will be determined by the terms of the qdro. It will either say her share is subject to the loan balance or not. For instance if you gave her 50% subject to your loan balance then her 50% share would actually be $43,500.00. If not subject to the balance her share would be $57,500.00. An attorney representing her would obviously not want to include the loan balance in her share.

As for being
Posted via Mobile Device
jd08 is offline  
post #3 of 4 (permalink) Old 02-14-2013, 11:32 PM
jd08's Avatar
Join Date: Nov 2012
Location: North Carolina
Posts: 303
Re: QDRO and 401K

Sorry got cut off... As for being penalty free, a qdro can have no tax consequences for the receiving spouse but there is certain specific language that must be included in the qdro. She must roll the proceeds directly over into an IRA within 60 days of the date of distribution to avoid tax consequences. Unless "magic language" is used though there is going to be a 20% income tax withholding off the top of the transfer for your spouse. If she doesn't roll over and takes the cash as an early distribution then the 20% withholding will apply in addition to possibly more taxes depending on her tax bracket.

Bottom line is you and your spouse need to consult attorneys regarding the transfer of retirement assets. There's a lot more I didnt cover - it's a complicated topic.
Posted via Mobile Device

Last edited by jd08; 02-14-2013 at 11:54 PM.
jd08 is offline  
post #4 of 4 (permalink) Old 02-25-2013, 04:22 PM
Registered User
Join Date: Dec 2012
Posts: 7
Re: QDRO and 401K

My 401k administrator had a QDRO template I simply filled out, got notarized, filed with the court, and sent to the administrator. Saved 300-400 in attorney fees.
Feynman is offline  
Sponsored Links

Quick Reply

Register Now

In order to be able to post messages on Talk About Marriage, you must first register. Please enter your desired user name, your email address and other required details in the form below.

Important! Your username will be visible to the public next to anything you post and could show up in search engines like Google. If you are concerned about anonymity, PLEASE choose a username that will not be recognizable to anyone you know.

User Name:
Please enter a password for your user account. Note that passwords are case-sensitive.


Confirm Password:
Email Address
Please enter a valid email address for yourself.

Email Address:


Human Verification

In order to verify that you are a human and not a spam bot, please enter the answer into the following box below based on the instructions contained in the graphic.

Thread Tools Search this Thread
Show Printable Version Show Printable Version
Email this Page Email this Page
Search this Thread:

Advanced Search

Similar Threads
Thread Thread Starter Forum Replies Last Post
Divorce, 401k, and finances momma2four Going Through Divorce or Separation 4 09-20-2012 11:13 AM
Retirement/401k differences no1.daddy2kids Going Through Divorce or Separation 5 05-07-2010 10:49 AM

Posting Rules  
You may post new threads
You may post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are On
Pingbacks are On
Refbacks are Off

For the best viewing experience please update your browser to Google Chrome