How Does a QDRO Work in Divorce? Divorce and a Qualified Domestic Relations Order

If you need to know how a Qualified Domestic Relations Order (QDRO) works in a divorce, you’ll need to first understand some elements of property division in divorce. Texas is a community property state. Anything purchased or acquired during the life of marriage is considered to be owned by both spouses equally. It is not relevant if one spouse works and the other manages the house. Under most circumstances, one spouse does not have more of an interest in the home because he or she earned more money than the other. In Texas, if you buy something when you’re married, your spouse owns it as much as you do. 

It is important to note that this does not apply to everything you own. For example, things that were purchased before or after the marriage are separate property. In addition, anything that was gifted to you or was given to you as inheritance is separate property. 

Retirement Accounts and a QDRO

When the division of property in a divorce pertains to retirement accounts, a QDRO can make the process easier. People save for retirement in a multitude of ways:

  • Pensions 
  • Individual Retirement Accounts (IRA)
  • 401(k) Plans

The question quickly shifts to how retirement accounts are treated during a divorce. Any community property can be divided. This includes retirement accounts. You and your former spouse can work and negotiate (preferably through your lawyers) to determine how your assets will be divided. If that doesn’t happen, a judge will divide your marital assets. 

How Does the QDRO Process Work?

Although Texas is a community property state, you and your spouse can still come to your terms. For instance, imagine keeping most or all of what was in the retirement account. And to add to this, imagine that the retirement account, e.g., a 401(k), was created through your spouse’s employer. 

Can you keep all of it? Possibly. There are ways this can be negotiated. For the sake of an easy example, let’s pretend your house is worth the same amount of money as what is in your retirement account. You could offer to give up your claim to the property. In exchange, your spouse offers to give you his or her portion of the retirement account. 

But how does a Qualified Domestic Relations Order fit into this scenario? If your former spouse agreed to let you keep all of the retirement account money, the money would still have to go through your former spouse. Regardless of a court order or agreement, the employer still pays your former spouse—who would then be obligated to pay you. 

A QDRO cuts through that. After a judge signs your QDRO, the money from the retirement account can go directly to you. If you and your spouse are parting ways, this will be one less way you are tied to and reliant on him or her. 

Ask Our Team for Help with Your QDRO

If you need legal representation to help you with your divorce, contact the attorneys at Amsberry Law Firm for your no obligation consultation. The distribution of assets is only one of several issues that are emotionally challenging and legally complex. Let us manage your legal hurdles so that you can move on with your life.

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The Amsberry Law Firm, founded in 1995, has helped thousands of clients overcome their unique legal challenges.

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