The distribution of marital assets can be a lengthy, stressful and even complicated aspect of your divorce. If you and your soon-to-be ex-spouse have retirement accounts to divide as well, it can be difficult to understand how to go about allocating those assets.

Establishing a qualified domestic relations order enables you and your spouse to maintain control of the division of your retirement accounts while also eliminating the need to pay certain fees or penalties. By learning more about how a QDRO works in the state of New York, you can make stronger decisions regarding the distribution of your assets during a divorce.

What is the function of a QDRO?

A QDRO, once accepted by the court, outlines the legal division of ownership interest over retirement accounts subject to asset division during a divorce. Other equitable division plans might call for the withdrawal of assets from the retirement accounts as a means to distribute those assets during a divorce, but this likely entails paying a penalty if you or your spouse are below retirement age. A QDRO grants a spouse the right to withdraw from a defined portion of the retirement account at their discretion, allowing them to wait to do so until there is no additional fee.

Is a QDRO agreement valid in New York state?

The Office of the New York State Comptroller explains that the state’s Court of Appeals considers retirement assets to be marital property under domestic relations law. Similarly, this means that the courts will recognize any properly drawn DRO or QDRO during the divorce process.

Using a QDRO during the division of marital property can save both you and your soon-to-be ex-spouse a great deal of time and money. It is important to work closely with your legal team to draft a legally-compliant QDRO.