addressalign-toparrow-leftarrow-rightbackbellblockcalendarcameraccwcheckchevron-downchevron-leftchevron-rightchevron-small-downchevron-small-leftchevron-small-rightchevron-small-upchevron-upcircle-with-checkcircle-with-crosscircle-with-pluscrossdots-three-verticaleditemptyheartexporteye-with-lineeyefacebookfolderfullheartglobegmailgooglegroupshelp-with-circleimageimagesinstagramFill 1linklocation-pinm-swarmSearchmailmessagesminusmoremuplabelShape 3 + Rectangle 1ShapeoutlookpersonJoin Group on CardStartprice-ribbonShapeShapeShapeShapeImported LayersImported LayersImported Layersshieldstartickettrashtriangle-downtriangle-uptwitteruserwarningyahoo

Single Parents - Divorced Adults Group Message Board › qualified domestic relations order

qualified domestic relations order

Mark R.
user 30646012
Middleton, WI
Post #: 3
Hello everyone,
Has anyone done a qualified domestic relations order?
I am looking into doing this with a Roth IRA.

Thanks, Mark
Cindy R
user 26664792
Oregon, WI
Post #: 12
Yes, I have. Questions? Cindy R
Optimistic C.
OptimisticChris
Madison, WI
Post #: 191
Me too.
To confirm... that is when $$$ is taken from a retirement account of one party and legally transferred to another without incurring taxes or penalties.
OC
Rick
RickThePerson
Madison, WI
Post #: 37
I had one done. My advice is to get a lawyer who does these things regularly to do the paperwork. If you are working with a lawyer for the divorce, (s)he should be able to recommend one. If it is not done correctly you will have to pay the penalties and taxes on the portion transferred to your ex.
Adam L.
user 13628645
Edgerton, WI
Post #: 24
I left mine in the QDRO BC as Rick indicated you can incure penalties if not done correctly. I do know that if you leave it you can use it tax free without penalties. So it can make a good emergency fund. I don't know if it can be split if the amount is top large for emergency fund. If you put it in an IRA you have to follow all the rights for an IRA. The QDRO grows tax free but as I said can be accessed free whenever. I believe the only reason you would want to move it would be for fund choices and you might have options within the plan. You are better off talking with the administrators of the qdro for free. No need to pay to talk with an attorney. Or if you have an investor they may know some more details.
Mark R.
user 30646012
Middleton, WI
Post #: 4
Thanks to those who replied.
I have spoken to my accountant and was told that a Roth is ineligable. Part of the MSA is to cash out the Roth.
She would get the proceads and has agreed to take on the tax liability, but since it is in my name, I would need to cash it out. What I was hoping to do is transfer the account to her and then she could cash it, and I would be out of the loop. So far, from what I've learned I can't do that. I have yet to speak with my attorney.
Cindy R
user 26664792
Oregon, WI
Post #: 13
From what I know, a QDRO doesn't mean you would have to cash out. Your part would stay in the IRA and she would be issued her own IRA and then she would have the choice to cash it or leave as it is. This is what I did (and I did all the paperwork for the judge) for my deferred compensation and my retirement account. I wouldn't think IRA's would be different; but I am not 100% positive.
Rick
RickThePerson
Madison, WI
Post #: 38
Cindy is correct, that is what the QDRO is for. When I had the order done, it was to split my 401K without penalty. The only other option would have been to absorb the cost in the form of increasing my mortgage, and I thought it stupid to essentially be paying interest on my retirement account (especially at a significant portion if not greater than what it would earn).
John C
JohnCurran
Dodgeville, WI
Post #: 72
I was interested in why a Roth wouldn't be eligible and I couldn't see any reason. Between lots of changes over the years, I've moved lots of things and the essential element is to move pre-tax to pre-tax and after tax to after tax unless you have an advantage to pay taxes at the current rate. You should ask the Roth folks how to move it (and their advice is free) you may need to have her on the current account, set up a new one at a different fund manager, move from one to the other, then get your name off the new account (and her name off yours). When you are taking the distribution it will ask if you want to roll any over and the name of the new fund manager. The check is mailed to you with the new fund manager as Payee. If you have a good fund, they may recommend just a separate account and can handle it in house. My Vanguard people wee WAY better than Fidelity people and my last major event took 15 minutes tops.
Mark R.
user 30646012
Middleton, WI
Post #: 5
Thanks everyone,
Many good suggestions. She is not on the account.
Powered by mvnForum

People in this
Meetup are also in:

Sign up

Meetup members, Log in

By clicking "Sign up" or "Sign up using Facebook", you confirm that you accept our Terms of Service & Privacy Policy