QDRO – because you might be S.O.L if you QDROn’t

QDRO (usually pronounced “QUAD-ro”, or in French “Herbal Engineering” parlance “Quoi?  Dro”) is an acronym for Qualified Domestic Relations Order. A Domestic Relations Order is an order filed with the court in a divorce or legal separation case, and the qualified part refers to the plan administrator saying, “Yup, that’s a good looking DRO.”  The plan administrator is the Potter Stewart of QDROs – they’ll know a good one when they see it.

QDROs are used to divide retirement accounts such as pensions or 401(k)s, and they are preposterously important.  

With most assets you divide in a divorce, you just throw them in a divorce decree & BOOM, you’re good.  Not so much with retirement accounts. A divorce decree is completely useless to divide a pension. Send your divorce decree to the Public Employees Retirement of Nevada (“PERS”) and they will lol at you, shake their head at you, or if they are feeling kind (which they probably will because the people at PERS are generally really helpful, but they’ll be lol’ing and shaking their heads on the inside), they will direct you to have a QDRO prepared.

No big deal you say.  My ex-spouse isn’t retiring for a while you say.  I’ll just do it later you say. I have more important things to do with my money than pay you to draft a super awesome QDRO you say.  Well first of all, thanks for the kind words about how awesome my QDROs are, but seriously, there is nothing more important you can do with $702 (and not just because everyone else I know charges significantly more for QDROs).

A QDRO should be entered with the divorce.  Why?

  1. So you’re covered if your spouse dies.

If your spouse dies before you enter a QDRO, you’re probably out of luck.  Many types of pensions you can split the benefit upon entry of the QDRO, meaning that you get your share for the rest of your life, regardless what happens to your ex. And let’s face it, can your ex really function successfully without you?  Can they really take care of themselves well enough to not die randomly? Why take that risk?

  1. Because you might forget later.

I mean yeah, your divorce is a big deal now, but you’re a cool and important person with lots of stuff going on.  Work and family obligations, book club, keg parties, maybe some new children, all that good stuff. Your social cup runneth over.  Thirty years from now you might not be thinking about your ex retiring. Heck, you probably will have erased that fool from your memory completely by then.  Why take that chance? Get it done.

3.Because it’s easier to do it now.

While you are in divorce proceedings, you have access to your ex.  They are required to deal with you to get this thing done. Deal with them now, while you already have to anyway.  

  1. Because you might be totally out of luck if you don’t do it within 6 years of the divorce.

In 2016, a case came out of the Nevada Supreme Court called Davidson v. Davidson (132 Nev. Adv. Op. 71 (2016)) which extended the six-year statute of limitations in NRS 11.190(1)(a) to apply to claims for enforcement of a property distribution provision in a divorce decree.  This case related to a deed, but I believe whether or not this applies to QDROs is going to be brought in front of a Nevada appeals court very soon, and in the meantime I would advise everyone who could potentially lose their property interest in a retirement to get this done ASAP, if not sooner.

So run, don’t walk, to GOAT Divorces (not really, we’re mostly virtual – just message me or give me a call) and get your QDRO done today.  We can set up an appointment to discuss any and all details of the process.  Your needs and wants were put on the backburner enough during the marriage, why have that spill over into the divorce?

Just like you shouldn’t gamble on securing your rights to a community property retirement plan, you shouldn’t gamble on just anyone preparing your QDRO paperwork.  I have a myriad of experience crafting QDROs, provide personalized service, and can help you with every step of the process through completion – and charge less money to do so.

 

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