QDROsQualified Domestic Relations Orders
Qualified Domestic Relations Orders, commonly called QDROs (pronounced Quad-dro), divide retirement accounts. Most retirement plans require QDROs in order to divide the account. Nevada Government employees often pay into a pension retirement program (PERS). PERS requires a QDRO in order to divide the benefit. The QDRO is a court order that directs the benefit provider how to divide the benefit based on the circumstances of the parties. Nevada law applies the time rule when dividing retirement benefits. This means the court uses a calculation where they look at how long the spouse has paid into the plan and how long the parties have been married, and then determine the community property share.
e.g. The parties were married for 8 years. During this time, one spouse paid into PERS through his employer for 5 years. The employee retires at 20 years. The marital share is ½ of 5/20ths, or 12.5%. If the benefit is $3,000 per month, the former spouse’s share is $375.00 per month.
In order for the benefit provider to pay the former spouse directly, a QDRO must be done and must be submitted to the provider.
QDROs can be malpractice traps for attorneys. A Divorce Decree is ineffective to assert a right to benefits, you must do a QDRO. If you fail to advise your client of this and something happens such as the other party dying, your client would likely be shut out of their benefit. It is best to do QDROs in conjunction with the Divorce Decree, or in worst case, immediately thereafter with a letter to your client stating they must complete the QDRO to preserve their right.
McFarling Law Group can alleviate this risk by preparing the QDRO for you and your client. Our fee is $850.00. If you would like to hire McFarling Law Group to prepare your QDRO, please call 702.565.4335.