During divorce participant was supposed to roll over a portion of retirement into the ex-spouse's designated account. The participant filled out a QDRO from the third-party administrator for a hospital 457 (b) non-government account. The participant did not let the ex-spouse or the court know that this was a non-qualified account. The court processed the QDRO only to later find out that the funds could not be rolled over into the ex-spouse's designated account. The court then ordered another QDRO to return the money to the participant's account. The employer then refused to return the funds to the participant because the ex-spouse was not a high-earning employee of the company or any employee of the company. The third party should not have approved the original QDRO to begin with because the participant was not transparent with the order of the court stating the funds need to be rolled over into a designated account. Should the court rescind the original order for the funds to be placed back into the participant's account? To complicate things, the participant terminated employment shortly after the funds were placed in a parallel account, not the ex-spouse's designated account, her IRA. The plan does note that unless the Plan is a church plan within the meaning of Code section 414 (e) which has not made the election described in Code section 410 (d), any group of employees specified under any of the options above must be members of a select group of management or highly compensated employees within the meaning of ERISA sections 201 (2), 301 (a) (3), and 401 (a) (1). Such a determination is solely the responsibility of the Employer.
