Dividing Retirement Accounts In A Divorce
During a divorce, you’re expected to divide your marital assets with your spouse. In North Carolina, this must be done in an equitable way, which does not always mean it’s an equal 50/50 division. Retirement accounts are included in this type of division and can be a point of concern for many spouses. You have likely spent years building up your retirement savings, and you may worry about how your divorce will impact your future retirement plans.
At Ellis Family Law, P.L.L.C., our divorce attorneys can help you explore your options. We represent spouses throughout the Triangle area from our offices in Durham, Pittsboro and Wake Forest. We will learn about your unique situation and develop a plan that will protect your retirement assets.
How To Handle Retirement Accounts During Divorce
Retirement accounts can include assets such as 401(k)s, IRAs and pensions. You have probably built up your accounts over many years with the plan of using them to fund a satisfying retirement. Divorce can impact these accounts. If you have collected retirement benefits through your employer, the amount earned during the length of your marriage is considered marital property and therefore must be divided with your spouse during a divorce.
If only one spouse has retirement assets while the other does not, it is still considered marital property, as any wealth acquired during your marriage is considered combined marital property. Your spouse can claim a portion of your retirement assets during the divorce. In these cases, the court may determine how much of a share of the retirement assets your spouse can claim.
You may be able to avoid the division process entirely if you have a prenuptial or postnuptial agreement in place that addresses how to handle your retirement assets.
Understanding Qualified Domestic Relations Orders
To divide your retirement assets during divorce, you will need to prepare a Qualified Domestic Relations Order (QRDO). This is a legal document issued by a judge that outlines how to divide retirement assets for the retirement plan administrator. A QRDO will allow you to specifically state the amount each spouse will receive from the retirement account once the funds are received. QRDOs can also help the owners of the retirement accounts avoid paying taxes or penalties on early withdrawals. Our attorneys at Ellis Family Law, P.L.L.C., can help you prepare and draft a solid QRDO that protects your share of the retirement assets.
Helping You Navigate This Process
We understand many spouses feel protective over their retirement accounts. You’ve worked hard to build up your funds and you don’t want to lose any of what you’ve acquired because of a divorce. Especially for couples who are at or nearing retirement age, it can be difficult to have to divide your assets when retirement is around the corner.
Our divorce lawyers take the time to fully learn about your situation and provide you with personalized options. We are committed to helping you reach a solution that doesn’t leave you feeling like your future retirement plans are completely lost.
Schedule A Consultation Today
If you need guidance with dividing retirement accounts during your divorce, our skilled attorneys can help. We represent spouses throughout Durham, Pittsboro and Wake Forest with complex divorce and retirement account matters.
Call us at 919-944-4811 today to schedule a consultation or email us online.