Everything You Need to Know About Qualified Domestic Relations Orders (Pt 1)

QDROs allow your spouse to benefit from YOUR employee benefits after a divorce, like your retirement account and your medical benefits.

If you’ve been considering divorce, then chances are, someone has mentioned a QDRO to you. What’s a QDRO? It’s a qualified domestic relations order, and like most people, you probably don’t have a clue what that is. Don’t worry – they’re pretty complex, and if you’ve never needed to know what one is, why on earth would you? But since people ask us on a semi-regular basis, we figured we’d break it down for our readers. Hopefully this helps.

What exactly is a QDRO?

In order to answer that, we have to explain what a DRO is. So here goes…

A Domestic Relations Order (DRO) is a court order that recognizes the right of a spouse, former spouse, child, or some other dependent of someone who is participating in an employee benefit plan, to receive all (or part) of that participant’s benefit in the Plan.

In other words, if you’re signed up for medical and dental care through your job, a DRO is a judgement from the family court here in Michigan that makes it legal for your spouse, or your kids, to benefit from those plans.

A Qualified Domestic Relations Order (“QDRO”) is pretty much the same thing, but it refers specifically to a DRO that has met all the specific requirements of federal law, and the specific provisions of the Plan. In essence, a QDRO is a court order that requires a qualified plan to pay all or any part of a Participant’s benefits to an Alternate Payee (which just means the other person or people who are designated as beneficiaries on your plan)

So remember that hypothetical medical and dental plan we were just talking about that you have through your job? Well, a QDRO is an order from a court that would force your Plan to give benefits to your spouse (or former spouse), or your kids, or whoever else is entitled to receive those benefits.

What counts as an employee benefit plan?

Medical and dental plans are only one possible version of this story. There are actually lots of different plans that would count as employee benefit plans. Which means there are lots of Plans that your ex might be able to claim benefits from after a divorce (which is why we’re explaining this – because it can really affect a divorce!)

So here are some of the more common ones (it’s not a complete list though, so always talk to your divorce attorney if you have questions about what might be covered under a QDRO.)

  • Medical benefit plans
  • Dental and Vision benefit plans
  • Retirement benefit plans (like a pension or 4O1K)
  • Group term life insurance
  • Long term care life insurance
  • Social security
  • Profit sharing

Do you have questions about divorce in Michigan?

Join us next time for more break down on QDROs (because this stuff can be confusing!). But if you’re considering divorce, and you have questions about dividing up your stuff, paying alimony, or figuring out custody, call The Kronzek Firm at 866 766 5245. Our skilled and experienced family law attorneys are available 24/7 to answer your questions and help you figure out what your next move should be.