Dividing Retirement Benefits Because of Divorce

When spouses separate or divorce and divide their assets, one or more retirement plans are usually involved. If these plans are sponsored by a private employer, they are governed by ERISA, and may not be divided without meeting special legal requirements. In particular, ERISA requires a Qualified Domestic Relations Order (“QDRO”)—a specific order that must be signed by a court or other agency and then accepted (“qualified”) by the retirement plan in order to be effective.