QDROphile

There is a "cash flow" PTE, but these facts do not appear to qualify.

How does one deny “other reimbursement amounts” if payment is by debit card and the card is not shut off?

I think the case for non-owner employees being treated as not retired if the employer still treats them as employed is pretty strong, but the elements of being employed have to be there, such as reporting on Form W-2. The bureaucratic hassle and expense to the employer of maintaining the employment formalities are a safeguard against a charade solely for accommodation of an individual tax dodge.

If you are talking about an owner (whether or not 5%) or owner's spouse, I think there is sensitivity, but I do not have any authority or experience to offer that the IRS has that sensitivity. This is even less definite than sham terminations in the context of distribution, which get a lot of discussions and have at least some IRS attention. I believe this is particularly acute in professional organizations, such as law firms, that allow partners to maintain hobby employments after "real" work production is finished, although this phenomenon is dwindling in the cruel realities of the marketplace. Finding bright lines is difficult; you have to go with gestalt. Unless the plan fiduciary is comfortable with the "come get me" approach -- which frankly is pretty safe in our non-enforcement environment, I would look for indicia of employment and evaluate the services and economic value to the employer to make admittedly subjective judgments about retirement status, and then try to establish some objective criteria to use for administration.

Sorry, this is out of my league. This appears to be a government plan and government plans live mostly by their own rules, complicated by use of unique terminology, which among other things, prevents you from translating the government planspeak into information that might be useful for analysis. You need a professional, probably a lawyer, who is familiar with the NYCER plan to unravel this.

I was just complimenting Lou S.

So you are now going to report your conclusion based on "Lou S says"? That is a decent answer on these Boards, but pretty lame in the wild world.

It is difficult to respond with any confidence without full information, and you will not be able to provide full information here. You will not be able to get a competent, correct, and complete answer here. You (your mother) needs professional assistance to evaluate and pursue her interests. However, it may help to get some learning and guidance here if you provide some additional information here, and it would be better if you started a new topic rather than confuse or divert a current topic. There is a "Start New Topic" button at the top. Additional information to provide: What is NYCER? Is the pension a defined benefit pension plan? Is the employer a government or government instrumentality or a private company? Did your father start his pension benefits before or after the divorce, or before or after his death? In what form was the pension paid -- if being paid (e.g. single life annuity, joint and survivor annuity)? What forms of payment are allowed by the plan? Where did the "death benefit come from? Did your father remarry? If so, was it before or after his pension payments started (if they started)? Possible outcome, based on ignorance of relevant facts and assumptions to fill the gap: Your father did not remarry and he started his pension after the divorce. The pension plan provides that participants unmarried at the time of start of benefits can receive only a single life annuity. This is a common pension plan design. That means that your father would receive pension payments for his lifetime that would cease at his death and no further payments would be made to anyone regardless of beneficiary designation. The pension plan operated properly and your mother gets nothing. That does not mean she has no claim against your father's estate because of the pension failure, but that is where you leave the realm of this website and need personal professional advice.

Perhaps you could edit the following; I cannot make out your point: "An order is a QDRO whether the plan determines that the order is a QDRO. In fact, courts may overrule plan QDRO determinations."

If the employer wants to give the former employee $900, then the over-distribution should be returned and the plan made whole in accordance with proper correction principles, the employer can pay $900 in a separate transaction. Unless it is done this way, the IRS (and state taxing authorities) can assert some tax violation, such as evasion of payroll taxes. The IRS sees payments in an employment situation first as regular salary or wages. The taxpayer/employer can be put in the position of showing a payment is something else (which usually has better tax consequences to the taxpayer than ordinary salary/wages).

The $300 limit is in ORS 243.507(8). The administrative rules of the plans, such as the PERS rule cited by Fiduciary Guidance Counsel are, and must be, consistent with the statutory limit. Thanks for digging out that statute so I could see what I overlooked in my original search.

I regret that I could not dig up the citation after some evidently inept searches, but it is an Oregon statute and I believe the maximum that a government retirement plan can charge for processing a QDRO is $300. That belief is supported by administrative rules of several government retirement plans in Oregon (that I found easily) providing for a maximum $300 charge, which would be consistent with the statute. The statute is a really good example of bad drafting for various reasons. I fear that the bad drafting may result in uncertainty about applicability to government 457 plans, if that is where you are going.

Sun Life v. Jackson suffers from the idea that the anti-assignment provisions applicable to "pension" plans applies straight across to welfare benefits. But the point is well taken. When the drafting is not focused on the goal (qualification requirements), the plan administrator has a more difficult job of interpretation. This phenomenon is also found in orders drafted by lawyers who do not understand retirement plans or the law and try to cover the gap by throwing more words into the order in hopes of scoring a hit. On the other hand, that problem is in part the fault of plan administrators who do not know what they are doing and only know an inflexible word formula to apply to determination of qualification. #ill-advisedmodelQDROforms

To get down to fundamentals, look at the definition of domestic relations order (a divorce decree is included) and then the requirements for what is necessary for qualification — what must be or not be included in the terms of the order.

Generically, beneficial interests are everywhere. They are distinct from, but go hand in hand with legal interests. The legal owner is the owner that has title to property and must be the one that executes buying and selling. If the legal owner is subject to terms that make the ownership for the benefit of another, the other is a beneficial owner and the legal owner has a fiduciary duty to the beneficial owner. What the benefit and the scope of the fiduciary duty is determined by doe instrument, such as a trust agreement/instrument, or common law (unwritten or implied). For example, someone might have a beneficial interest in interest (but not principal) of a bond, or might have a beneficial interest in both the principal and interest. The bond would be owned by the legal owner, subject to the rights of the beneficial owner(s). A beneficial interest also falls under the term “indirect ownership.” This is a very broad and complex subject of property and contract law. Beware acting or advising on your own conclusions based on labels.

Yes, I have seen that. There are at least two phenomena. One is legitimate; the former spouse has a protective order and uses the lawyer's address to prevent discovery. The other is the lawyer trying to assure payment out of certain funds. Not that getting paid is illegitimate, but I believe the anti-assignment rule does not allow anyone to get out in front of a distribution. How one enforces a creditor claim after the funds are in the hands of the appropriate recipient is not the plan's concern. I have been involved in discussions about provisions concerning allowing the division of nonqualified deferred compensation in divorces and potential effect on negotiation of property settlement in divorce. Generally I think it is better to allow all assets to be on the table. By removing or restricting a significant asset, the settlement can get skewed against the interests of both parties. At least with highly paid or wealthy participants, the value of the unavailable/restricted asset is still taken into account, which means that some other asset must be divided disproportionately. Not that proportionate division is sacred, but my Econ 101 class tried to convince me that individuals were always better of by having a choice about allocation of resources.

Although I was ambivalent about it at best, I had a client that restricted distribution to discourage what the client said was actual experience with raids on the retirement plan via sham divorce, e.g to buy the recreational fishing boat. This was long before the sham divorce cases were decided. The very sad economics in many divorces is that the (usually female) former spouse has to (or does, in any event) take distribution in order to pay the divorce lawyer* and otherwise get by after the divorce. *This gets us into the completely unrelated topic of attempts by divorce lawyers to be named directly or indirectly as a payee or otherwise get first crack at the QDRO distribution, which is troublesome for the plans.

Last pragraph: One person’s scare is another’s marketing effort, but I agree that both deserve skeptical consideration

And if the contract says fees can be charged, but the administrative fees were covered otherwise as a regular practice*, the practice could have reformed the contract, so the contract term to charge the fees to the participant account is no longer effective and cannot be resurrected. *This is potentially an interesting issue -- possibly a disguised contribution.

Yes, breach of contract.

If the business is conducted in the US and has US employees (or other eligible US domiciled employees), it is likely the the US business is a subsidiary of the PLC, organized in a recognizable form under US state laws and tax law: e.g. corporation, S corporation, LLP, LLC, and the check-the- box option for tax treatment is available as appropriate.

My first inclination is to mostly agree with Larry Starr and say the the order can specify that the alternate payee's subaccount(s) can be created as of a specified date by designating x% the participant's mutual fund portfolio and y% of the participant's pooled fund account (or dollar amounts from each, which can be translated into percentages). Part of my approach assumes certain limitations on the mutual fund platform. Fidelity,for example, has lots of limitations, to the point that I think Fidelity puts the plans at risk of violation of the law. I would modify depending on exactly how the mutual fund platform and pooled fund worked and what the participant is able to do by way of transfer of funds. System capabilities are a big factor. For example, if the pooled fund is valued only annually, then any division of the participant's pooled fund interest would have to fit with what the plan is able to do administratively with pooled fund balances. At the extreme, the AP's pooled fund interest would have to be specified as a dollar amount or a percentage of the balance as the the valuation date. If the mutual fund platform has great administrative capability and flexibility, then the plan should be able to accommodate even a specification of the AP's share of each investment. The limitation is IRC section 414(p)(3)(A).

I saw nothing about 403(b) in Spatel’s post.

And they are barred.

The elective deferral limit is personal (401(k)); The 415 limit is based on the employer. You should get advice about what type of retirement arrangement would be best for your presumably separate business.