People often confused the Qualified Domestic Relations Order (QDRO) with a divorce decree or property settlement. QDRO is a tool that recognizes a soon-to-be ex-spouse or ex-spouse interest in the other spouse’s retirement plan. 

The employee whose interest is being transferred is known as the ‘participant,’ while the receiving party is called the ‘alternate payee. QDRO can also recognize the right of the participant’s children and other dependents, if there are any.

Usually, a QDRO is issued by the state or an authority. In an event where the requirement doesn’t tally with the plan’s rules, the QDRO administrator can reject it. For a better outcome, it is often best to work with an experienced and reliable attorney.

How To Get A Qualified Domestic Relations Order

When it comes to getting QDRO, it involves following a series of processes with your attorney. Ideally, your attorney will draw up the QDRO. The document is given to a judge to sign, while the alternate payee proceeds to the retirement plan administrator for approval.

If the plan administrator accepts the QDRO, it could take more than 18 months to respond to both parties. That is why it is advisable to submit the QDRO as early as possible. Most separating couples want the QDRO to be accepted before the divorce is finalized. If unexpectedly it was rejected, the alternate payee can renegotiate that part of the divorce settlement.

How And When To Use A QDRO

For a Domestic Relations Order to become an enforceable order, the court must first approve a property settlement agreement. The order has to be qualified and reviewed by the employer’s plan administrator. The order, however, has to be prepared simultaneously with the divorce agreement. It is paramount for parties to avoid errors, as amendments, refilling, and re-approval can cause a delay.

Not only do mistakes waste time, but the non-employee spouse is also most likely to lose the benefits. Since this is a very crucial issue, it is best to prepare it alongside the divorce as soon as possible before divorce is finalized. Also, the court could take a lot of