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Does a QDRO satisfy this 401(k) stipulation in my decree of dissolution?

Bellevue, WA |

I was working on getting a QDRO finished for the clause below when my ex announced that this is not satisfactory and that I must pay her in cash.

$4,603.50 from husband’s T-Mobile 401(k). Husband shall make this
payment in full within one year (by June 1, 2011).

Obviously, I missed the court's deadline either way so I'm trying to get it resolved as quickly as possible but I don't have the money to pay cash. Does the QDRO that sets up an account in her name satisfy the requirement, or do I need to pay her directly?

I just noticed that in the PROPERTY TO BE AWARDED THE HUSBAND section it states: Husband’s T-Mobile 401(k) less 50% of its value as of the Date of Separation ($4,603.50) to the wife. This is why I had been working on the QDRO instead of trying to find a way to come up with a cash payment.

Attorney Answers 4

Posted

The decree says her cash comes from your 401(k). Only a QDRO can do that. Your ex will need to pay taxes on the $4,603.50, but she volunteered for that when she said the money had to come from your 401(k). Depending on her tax bracket, there may be very little tax to pay. The upside for your ex is that she doesn't have to pay any penalty.

The biggest problem I see for the two of you is your fight is going to cost more in attorney fees than it's worth. Ask your 401(k) manager for a sample QDRO form they will accept. Then hope your ex recognizes it is not worth fighting over this. Be sure you communicate with her in email so that you can show a court you were trying to the right thing.

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Asker

Posted

Thank you for the detailed answer; I really appreciate it. Unfortunately, both my ex and her mother are lawyers and legal fees are not a concern for them. They are a major concern for me since I am the primary parent of our two kids and am just scraping by (she pays only $86/month child support because she is "wilfully underemployed"). I agree with you about doing the right thing and even though I blew the deadline I was trying to make it right with the QDRO. My ex has stated that she will ONLY accept cash and if it's not in hand by 12/1 she will take action to find me in contempt of court. I spoke with a lawyer and they said she was within the orders to request cash, but now my 401(k) is frozen while the QDRO is unfinished. The timing of all this with the holiday weekend is not a coincidence, and I'll be hard pressed to work with a lawyer, the firm handling the QDRO, or even to get an emergency loan from a bank before her stated deadline. Any thoughts or suggestions?

Douglas Paul Becker

Douglas Paul Becker

Posted

If cost doesn't bother your ex, your options are limited. The courts aren't going to take care of you like a hospital. They are referees at a fight and you're to get beat up because the QDRO needed to be done now, not just started. Along with contempt will come an award of attorney fees and interest will start racking up (12% annually in WA) and then everything will really start to slide downhill. Email her that you agree to pay cash and ask for 2 weeks to raise it. Then get a loan and pay her, the sooner the better. It will be cheaper to deal with a lender than your ex.

Asker

Posted

I agree with you. I paid her in full so I could be done with it on that end at least. Thank you for your answers.

Posted

You need to have an attorney review the orders, interview you, review your 401(k) documents, and then advise you.

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Posted

If the Decree does not specify how the payment is to be made, then a QDRO whould be sufficient but for the fact that you have already missed the deadline in the Decree. The problem is she can take you to court to enforce the Judgment long before you will be able to get a QDRO approved and a court must sign off on the QDRO meaning you will have to give her notice of the hearing to sign off on the QDRO. I don't think the QDRO is the best way to go under the circumstances set forth above,

The information is for general information purposes only. Nothing stated above should be taken as legal advice for any individual case or situation.

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Dave Hawkins

Dave Hawkins

Posted

Bruce is correct as to the language, but my point is as a practical matter, I'm sure she does not care how she gets her money.

Dave Hawkins

Dave Hawkins

Posted

I meant Bruce and Paul

Posted

The Qualified Domestic Relations Order is a way for you transfer the money and protect the parties tax position. I would suggest that whatever was negotiated in your agreement should stand and that if you need a qualification or more time, go back to court as soon as possible. Good luck and take care, Happy thanksgiving.

Legal disclaimer: The response given is not intended to create, nor does it create an ongoing duty to respond to questions. The response does not form an attorney-client relationship, nor is it intended to be anything other than the educated opinion of the author. It should not be relied upon as legal advice. The response given is based upon the limited facts provided by the person asking the question. To the extent additional or different facts exist, the response might possibly change. Attorney is licensed to practice law only in the State of Massachusetts. Responses are based solely on Massachusetts law unless stated otherwise.

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