What Happens to Your Retirement Accounts in Divorce?
You Will Need a Qualified Domestic Relations Order (QDRO) and a Thorough Legal Advocate
Essentially, your investments and retirement accounts, including pensions, are just like all other property in divorce. It will be divided equitably, in consideration with your holistic marital assets, which means that the split will not necessarily be 50-50.
What investments are we talking about?
- 401(k) and 403(b) plans
- IRA and Roth IRA plans
- Pension plans
- Military pension plans
- Stock options, both vested and unvested
It does not matter whose name is on the account unless a winning argument can be made that one spouse had nothing to do with contributing to an account in question — a tough thing to do in most situations, since a marriage is generally a partnership. However, a prenuptial or postnuptial agreement already in place would be a factor in the division of these accounts.
What Is a QDRO?
When there are retirement and other investment assets in a divorce, a QDRO is necessary to split the value of the accounts equitably and prevent tax consequences. Our attorneys will help you divide these accounts as efficiently and fairly as possible. You can transfer these balances tax free and maintain your stable financial future with our help.
Please call us at (888) 461-7744 or email us for a free initial consultation about your retirement accounts and a QDRO with an attorney in Grand Rapids or Kalamazoo. We serve clients throughout Michigan.
How You Can Protect Your Fair Portion of the Nest Egg
Retirement assets and stock accounts are usually some of the most valuable, if not the most valuable, assets a couple has. One of the best things about them is that most of the funds are very tax efficient, if you can wait until retirement to receive distributions. In most situations, it is to your advantage to ensure you get a big slice of this pie in the divorce settlement.
This is where our lawyers can be of tremendous service to you.
- We will help you understand your rights and opportunities in Michigan's principle of fair and equitable distribution of assets.
- We explain the concept of marital property vs. nonmarital property and how each applies in your unique case.
- We complete in-depth analysis of all assets you own as a couple and as individuals.
- We are advocates and negotiators for your personalized strategy.
Good News for Account Holders
If funds were acquired prior to marriage, the principal amount (original investment) may be considered nonmarital property. Additionally, unvested stock options and portions of pension plans may also be considered nonmarital property.
Good News for Spouses of Account Holders
Unless a legal marital agreement states otherwise, net gains in all assets are considered marital property. All funds acquired during the marriage and any assets commingled during the marriage are considered marital property.
Ensure Your Best Interests Have a Persuasive and Strategic Advocate
In some cases, it may make sense to negotiate for less ownership of investment accounts in favor of taking on less of the marital financial debt burden or to focus on negotiating for ownership of other assets such as your home (another huge slice of the pie), a business or other property.
It is to your great advantage to solidify your strategy with an experienced attorney, thereby securing advocacy that is on your side all the way through to resolution. Your long-term financial prospects and peace of mind are well worth it.
Please call Willis Law at (888) 461-7744 for a free initial consultation with one of our attorneys. For your convenience, we have office locations in Kalamazoo, Grand Rapids and Paw Paw. We serve clients throughout Michigan.