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This was my intended answer. I was shaking my head (not nodding, but shaking) so hard that I missed the first two questions. Good Luck!

The most simple answer I can come up with is that a plan has to be maintained for the exclusive benefit of employees and former employees (the exclusive benefit rule), and what you are proposing would violate that very basic premise.

That, and a whole lot of years in this industry having seen just about everything with an economic incentive to an ERISA advisor or consultant run up the flagpole. And enough investment advisors would jump all over the concept that if it had any legs at all would be common practice by now. There is strength in numbers. I have some sympathy for clients that find themselves sold a bill of goods by practitioners that promise what many in the industry would run away from. Having spouse's labeled participants (in the absence of a QDRO) strikes me as a hard slog and precious little strength (i.e., no numbers).

You asked three questions in the original post. The answers are: Yes, Yes, Nope.

somewhere I read recently there is even talk of eliminating it. of course, if you think about it everyone has access to the 5500 on the DOL website anyway, so the silly SAR form makes even less sense than it might have years ago.

Thank you. As I have stated before, I think the SAR is one of the most completely useless disclosures ever. Nevertheless, I couldn't find any basis to support not sending one in this situation.

Nope. Good Luck!

First of all I want to express a heartfelt thank you for each of you for taking time to share your expertise with a stranger. There are many valid points in your answers. To Pmacduff: Unfortunately there is enough income tax owed to absorb 75% of the QDRO because no taxes were paid out of her disability or alimony. Just knowing this makes me feel a little angry, but she has had no extra cash for luxuries because her medication has taken every dime. ESOP Guy, she has no family and as I said, she is a recluse, in part due to a movement disorder with symptoms similar to Tourette's. The situation is urgent, but you are wise to suggest I seek assistance from a pro before the distribution. I tried Belgararth's idea (your kindness was more than I expected) and called a trusted charitable organization who found an expert volunteer willing to come to our home to help with the taxes. And last, but most definitely not least, QDROphile, your brilliant suggestion is the best way to protect the portion of the account she cannot put toward her debt; she will be in danger of homelessness if she is not receiving adequate care. I was pleasantly surprised to find that everyone who contributed here withheld judgment on the issue and gave well-considered advice. Thank you all so much for that. Best regards.

HA! I have been thinking of asking Dave to add some sort of "ping" feature but it appears he already thought of it!

I can't imagine why I would want one and I always have a balance!

Maybe it's a typo and they meant 'bungled'