It is common practice to divide retirement accounts at the time of divorce. Often this is accomplished through a Qualified Domestic Relations Order (QDRO). A QDRO orders the account holder to divide the applicable account and is entered after the final judgment of dissolution of marriage.
In one recent example out of the First District Court of Appeal, the parties agreed to divide the Husband’s pension and 401k in half as of the date of their agreement. They also agreed to do this by QDRO. However, the QDRO was never arranged by the parties and thus was not entered by the trial court. Once the Husband retired the Wife brought an action to have the QDRO entered (approximately 20 years later).
Fortunately the value of the Wife’s interest had increased substantially since 1993. The Husband argued that she was only entitled to the specific dollar amount she would have received in 1993 ($18,111.49) and the Wife argued she was entitled to the amount she was to receive and any gains on that amount ($103,000.00). The trial court initially agreed with the Husband’s argument.
On appeal the First District remanded the case finding that the Wife was entitled to any gain or loss on the retirement account. As is often the case on appeal the Court looked very carefully at the language of the agreement. The Court found that if a specific dollar amount had been intended the parties would have stated the amount instead of giving her an ½ interest in the account.
When dealing with complex matters such as the division of retirement accounts it is always advisable to have an attorney draft the marital settlement agreement and assist in providing a QDRO to assure proper division. Martin Law Firm offers assistance for people in need of Uncontested Dissolution of Marriages or help drafting a Marital Settlement Agreement. This can save the confusion and difficulty many years later as experience in the above example.
See, Graham v. Graham, 38 Fla. L. Weekly D1869 (Fla. 1st DCA 2013).
Dustin Michael Butler is an Attorney with Martin Law Firm, P.L., whose practice focuses in Family Law and Civil Litigation. He is admitted to practice law in the State of Florida and the Federal Court for the Middle District of Florida. He primarily practices in Southwest Florida including Lee County and Collier County, Florida, Fort Myers, Cape Coral, and Naples.