How to properly submit a QDRO to the court and the retirement plan administrator

Okay, you’ve been told by the retirement plan that you need something called a QDRO, then you drafted your QDRO. What’s next?

If you’re not there yet, here’s a quick recap: a Qualified Domestic Relations Order (QDRO) is a specialty court order that divides a retirement account using a mixture of federal and state law. By using a QDRO, you end up with the fairest division of the account (as the plan administrator, with all their records, does the math) and you gain exemptions from early withdrawal penalties and immediate tax consequences for the plan participant (each person is taxed when they take the money out, on their share, rather than the plan participant getting hit with all the taxes). Most divorces require a QDRO, many lawyers skip the QDRO and leave it to the parties to do on their own, and we help people draft them using versatile software that supports over 500,000 private retirement plans, with government plans coming soon.

So, once you have it drafted, what’s next? Pre-approval, signatures, court filing, certified copies, and execution, of course. Here are those steps, in more detail, on how to properly submit a QDRO to the court and the retirement plan administrator.

To be valid, a QDRO must meet certain requirements, such as:

•  It must clearly identify the name and address of the plan participant (the person who earned the retirement benefits) and the alternate payee (the person who will receive a share of the benefits).
•  It must specify the amount or percentage of the benefits that will be paid to the alternate payee, or the method of calculating such amount or percentage.
•  It must specify the number of payments or period of time that the QDRO applies to.
•  It must not require the plan to pay more benefits than it would otherwise pay under its terms.
•  It must not require the plan to provide a type or form of benefit that it does not offer.

To prepare a QDRO, you will need to gather some information, such as:

• The name and address of the retirement plan and its administrator
• The plan participant’s contact information, social security number, and date of birth
• The alternate payee’s contact information, social security number, and date of birth
• The date of marriage and date of asset division (typically the date of separation, divorce filing, or final judgment of divorce – the asset division date, also called the assignment date, varies by state).
• The court case number and jurisdiction
• The amount or percentage of benefits that will be assigned to the alternate payee

You can use a sample QDRO form provided by the plan administrator, but these are often complicated and written to benefit the plan, rather than the participant and alternate payee. You can also use our online drafting software, which guides you through the drafting process, allows you to preview documents before you pay, and provides an editable draft at the end, in case the plan requires further edits. When drafting your order, you’ll want to make sure that the QDRO is consistent with your divorce decree and reflects your agreement with your former spouse.

To submit a QDRO to the retirement plan administrator for pre-approval, you will need to follow these steps:

• Locate your plan administrator. A great place to start looking is the human resources department of the participant’s employer.
• Email, fax, or hard copy mail your draft order with a note explaining that you are seeking pre-approval of the language in the order.
• Wait for feedback on the draft language and consider any suggested edits by the plan administrator. Don’t be afraid to ask questions if you don’t understand their proposed edits, and if you still need help, there are attorneys that specialize in QDROs that may be able to provide advice.

To submit a QDRO to the court, you will need to follow these steps:

• In most jurisdictions, the fastest way to proceed is to have both parties sign the QDRO and then you can file it with the clerk of the court for presenting to the judge. If both parties have signed, usually the court’s approval is a rubber stamp and no hearing is required.
• If either party refuses to sign, you may have to file a motion with the court requesting approval of the QDRO. If this is necessary, consider consulting with an attorney or heading to the court’s self-help office for further guidance.
• Some states simply require you to serve a copy of the QDRO on your former spouse or their attorney, and if no objections are filed, the court will sign the order.
•  If the order wasn’t signed by both parties before filing, you’ll likely have to attend a hearing where the judge will review and sign the QDRO
• Once the court signs the order, obtain a certified copy of the signed QDRO from the court clerk

To submit a QDRO to the retirement plan administrator, you will need to follow these steps:

• Obtain a certified copy of the QDRO once it has been signed by the court.
• Submit your final QDRO to the plan administrator for approval. You will need to send a copy of your court-approved QDRO to the plan administrator for review and approval. The plan administrator will check if your QDRO meets the plan’s rules and regulations and does not conflict with any other QDROs on file. If the plan administrator approves your QDRO, it will notify you and start processing your payments according to your QDRO. If you followed the above pre-approval steps, this is usually automatic since the plan already approved the language.
• The plan may also provide a form for the parties to fill out if they want to waive a 30 to 60 day appeals period (where either side can contest the plan’s interpretation of the order) and may require additional forms from either party, plus copies of the divorce judgment.
• Keep a copy of your QDRO and monitor your payments. You should keep a copy of your QDRO and any correspondence with the court and the plan administrator for your records. You should also monitor your payments and report any errors or delays to the plan administrator as soon as possible.

QDROs can be a complex and time-consuming process, but it can also be an important way to secure your financial future after a divorce. We’ve made these complex orders into a series of guided questions that should help most users draft an order that fits their divorce terms and their personal financial goals, all at an affordable price, with the ability to preview the docs before you pay. If you’re in need of a QDRO, give our QDRO machine a try today.