Dealing With Retirement Savings Fairly
For couples divorcing after having been in the workforce for a while, retirement savings can constitute a large chunk of their assets. The question of how they should be divided, however, aren’t clear cut.
At Gormley and Johnson Law Offices, PLC, our attorneys can help clients figure out exactly how to divide retirement accounts. With offices in Howell and Fowlerville, we’re well-positioned to help individuals across Michigan get the best results possible during property division.
Understanding QDROs And How They Can Help
Simply put, dividing retirement assets is complicated and riddled with tax implications and other difficulties.
For example, the money in your retirement accounts at the start of your marriage is considered separate property. However, any money placed in 401(k)s and other retirement plans during the marriage is typically seen as marital property, as it’s only natural for couples to plan for retirement together. Finding out just how much was in your accounts at the time of marriage can be easy — or it can be complicated if the records are muddied.
In addition, the division isn’t as simple as just withdrawing half of your 401(k) and giving it to your spouse. This will trigger large tax consequences and early withdrawal penalties that can decimate your savings.
In these situations, a qualified domestic relations order (QDRO) can help. What a QDRO does is it splits the retirement savings, giving each spouse an agreed portion. Drafting QDROs can be complicated, as they can involve decades of records, and require your lawyers to work with plan administrators and outside professionals.
Our attorneys have years of experience in family law, business and financial dealings, and the division of complex family assets. We can help.
Contact Us Today
To learn more, schedule a free initial consultation by calling our offices at 517-219-9301. You can also contact us online. We proudly serve Livingston County and nearby communities, including Lansing/East Lansing and Brighton.