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If you will provide the name of the Plan somebody in this blog might be able to respond to your question. You have suggested that your husband's plan offers a 100% survivor annuity plan with a pop-up. The term "pop-up" is most often found in state, county or municipal defined benefit plans, not in ERISA qualified plans. On the other hand most state, county or municipal plan do not provide an option for a separate interest allocation of benefits. And most non ERISA plans do use the term QPSA or QJSA. They are almost always limited to a shared allocation payable if, as and when the Participant retires and starts to draw his pension. So it is hard to understand what you are talking about. If your stipulation said "shared", then that's the deal you made and you are stuck with it. It doesn't matter if your lawyer was competent of not, that is the deal you are made. It may be the best option. But it may not. But in all events you cannot insist that it be changed to a separate interest allocation. There are pros and cons to each. See the attached Memo - Shared v. Separate - that also discusses the other attached Memo that addresses your right to ask that he be required to pay you your share of his retirement when he is eligible to retire even though he chooses NOT to retire. See the attached Memo - Gilmore Approach. The law varies from state to state. Tell me where you case is pending and perhaps someone can direct you to a competent practitioner in your jurisdiction. David Goldberg Gillmore Approach - 5-23-19.pdf Shared v. Separate v. Lump Sum v. Gilmore, and more.pdf

There a 4 options for accomplishing what you seek to determine. (i) Determine the value of the account at the date of marriage and compute gains and losses to bring it forward to the date of divorce. This will give you the non-marital portion. The balance will be the marital portion. It is sometimes not possible to find the records of the value at the date of divorce, and many Plan Administrators and most IRA custodians do not have the ability to bring these balances up to date for you. Some Plans like TIAA-CREF and TSP have detailed historical records of the monthly changes in the value of their respective investment options. (ii) In a shorter term marriage, pull the tax returns and W-2s and determine the contributions made during the marriage and compute gains and losses to bring them forward to the date of divorce. The same problems exist as are outlined in “(i)” above. (iii) Take the value of the account as of the date of marriage and use an average of, e.g. the Dow Jones Industrials, the NASDAQ, the S&P 500 and the Moody’s bond rate as of the date of marriage and as of the current date. Apply the yearly percentage changes to the value at the date of marriage and the result is the non-marital share. The balance is the marital portion. The same approach can be taken with respect to the amounts contributed each year from the date of marriage to the date of divorce. (iv) Use the (Maryland) - Bangs/Pleasant formula. Multiply the account balance at the time of divorce by the coverture fraction where the numerator is the number of months during which the party made contributions to his/her IRA or 401(k) during the marriage, and the denominator is the total number of months during which the party made contributions to his/her IRA or 401(k) as of the date of divorce. The result will be the marital portion to be divided. This has been criticized as unreliable since: (i) it assumes equal contributions to the Plan during the entire period set forth in the denominator of the coverture fraction, and, (ii) it assumes equal increases/decreases in value of the Plan assets during the entire period set forth in the denominator set forth in the coverture fraction; and, (iii) it fails to adjust for inflation/deflation from the date of marriage to the date of divorce; and, (iv) it assumes that the mix of investments remains the same. But, it’s better than nothing. And it better than, (i) concluding that premarital and post-marital contributions to the account resulted in a commingling of funds that renders the entire account as “marital”; or, (ii) that all post marital increases or decreases in value from the date of marriage forward should be disregarded. So the problem is the assumption that "earned during the marriage" has a meaning and is easily capable of determining. To see the problems that can be created by using option (iv) to allocate defined contribution plan benefits, see Granger v. Granger, No. 20140196-CA, Court of Appeals of Utah (2016) that you can find at: https://scholar.google.com/scholar_case?case=1223294215352864252&hl=en&lr=lang_en&as_sdt=20006&as_vis=1&oi=scholaralrt. And see Dutille v. Dutille, 52 Misc.3d 303, 28 N.Y.S.3d 813, 2016 NY Slip Op 26109 (2016) that you can find at - https://scholar.google.com/scholar_case?case=13824837295212223034&q=dutille&hl=en&as_sdt=4,21,33 In a 2018 decision in Kabasan v. Kabasan - https://scholar.google.com/scholar_case?case=13034137486072388695&hl=en&lr=lang_en&as_sdt=20006&as_vis=1&oi=scholaralrt the Court of Appeals of North Carolina held that the use of the coverture fraction formula by the trial court was not error when determining the marital portion of the husband’s TSP, an annuity, and an IRA. And the recent Maryland case, Reynolds v. Reynolds, 216 Md. App. 205, 85 A. 3d 350 (2014), noteworthy in that it discusses the proof necessary to demonstrate the increase in the value of the non-marital share from the date of marriage to the date of divorce. See also a recent case from Virginia, Mann v. Mann at: http://scholar.google.com/scholar_case?case=2795450834253640273&q="marital+portion"+401(k)+%2Bcommingled&hl=en&as_sdt=ffffffffffffe04 The basis of this decision was that passive appreciation of non marital property is itself non marital. Bottom line is that you need to give the Plan a dollar amount (or percentage) as of a Valuation Date and that dollar amount will be adjusted by gains, losses and investment experience from that Valuation date to the date of rollover or distribution, as the case may be, to the Alternate Payee. See attached re: Gains and Losses - Gains, Losses, Ownership Interest and Constructive Trust

For what purpose do you need to define "vested balance"? For purposes of allocation a defined contribution account in connection with a divorce?

Thanks for your comments. I regularly lecture my colleagues about the dangers of using model QDROs and send them excerpts from Gary Shulman's treatises. The lawyer on the other side is a very well regarded QDRO practitioner who actually creates pension plans and acts a TPA for some of them. She ought to know better. When she speaks I usually listen. I thought I was going crazy. And while that may be true in other contexts....not this time. The problem is the cost of taking the Plan and/or Fidelity to Court. Thanks to all of you. David

Since my Memo's keep getting truncated (are we run by Twitter?), I have attached a portion of my post in PDF. Goldberg Memo.pdf And here is my last paragraph.... Bottom line is that the Alternate Payee in the case at issue can be awarded a share of the retirement annuity via a QDRO, but the 75% survivor annuity for the Alternate Payee cannot be changed except by a waiver, and I think that ship has sailed. It might be possible to mollify the ex-husband in this case by reducing the Alternate Payee's share of the retirement annuity to a percentage less than 50% in order to allocate 1/2 of the cost of the survivor annuity to her. That would be fair. David Goldberg

The post said, "You said, "The plan administrator now says that the J&S can be removed." Not true. Aside from the concept of QJSA used in preparing a QDRO, a 75% Joint and Survivor Annuity means that the Participant will receive the same monthly pension as long as he lives. If he dies before his designated beneficiary, monthly payments of 75% of the amount received by the Participant during his lifetime will be paid to the beneficiary for the rest of her life. The amount paid to the Participant will have been actuarially reduced to pay for the "cost" of providing payments over two lifetimes. A QDRO can be used to address the allocation of the retirement annuity, but the same is not true of the survivor annuity IF the Participant retired before divorce. The retirement locks in the survivor annuity election and it cannot be changed by a Court using a QDRO, or by the parties without meeting the waiver requirements of ERISA. In Vanderkam v. Vanderkam, 776 F.3d 883, 892 (D.C. Cir. 2015) - https://scholar.google.com/scholar_case?case=18372616915023449748&q=vanderkam&hl=en&lr=lang_en&as_sdt=20000003&as_vis=1 a number of matters were made clear, as follows: It is undoubtedly true that when a Participant in an ERISA qualified plan retires, his then wife (the Alternate Payee) will immediately become irrevocably vested in her entitlement to a Qualified Joint and Survivor Annuity. The only way the Alternate Payee can lose this entitlement is via a waiver previously executed by her within 180 days prior to the commencement date of the Participant’s retirement annuity. See 29 U.S.C §§(c)(1)(A)(I) and (c)(7)(A). [There is another section of the law dealing with the time frame for waiver of a Qualified Pre-retirement Survivor Annuity.] During that 180 day period, the Alternate Payee may also revoke such waiver. See §(c)(1)(A)(iii). If the waiver is executed prior to the applicable election period, it is void. It would seem clear that if the retired Participant and his wife later divorce, it is not necessary to prepare a QDRO confirming her entitlement to a QJSA. While a QDRO would be required to award a share of the Participant’s retirement annuity, and while it might be a good idea to confirm the Alternate Payee’s entitlement to a QJSA, failure to set forth the entitlement of a QJSA in a QDRO will not negatively impact the Alternate Payee’s right to receive such benefits, and the Participant will not have such QJSA benefits restored to him so that he can name his new wife as the beneficiary thereof. It would seem safe to conclude that, in a situation where the Participant has retired from an ERISA plan with a current wife, that the interest of the now ex-wife in the QJSA is protected whether or not the Agreement or the ad damnum or the JAD mentions the QJSA (or even the QPSA) and whether or not a QDRO addressing those entitlements is ever prepared or submitted to the Plan Administrator. Read the District Court opinion in Vanderkam v. PBGC, 943 F.Supp.2d 130 (USDC - DC Cir. 2014). https://scholar.google.com/scholar_case?case=12124402217069574423&q=vanderkam+v.+pbgc&hl=en&lr=lang_en&as_sdt=20000003&as_vis=1 Read also the well written opinion of the United States District Court for the District of South Carolina in Setzer v. Michelin Retirement Plan - C.A. No. 3:13-cv-00192-MGL - https://scholar.google.com/scholar_case?case=4368934987489954107&q=setzer+v.+michelin&hl=en&lr=lang_en&as_sdt=20000003&as_vis=1. In this case the parties were married when the husband retired and was required by ERISA to elect a joint and survivor benefit for his wife. The only way for him to make another election would have been with the consent of his wife. Five years later, after their divorce, Mr. Setzer asked the Plan to permit him to change the survivor annuity election and to name his new wife as the beneficiary. Here is the well written ruling of the District Court: “In his benefit claim, Setzer requests that in light of his divorce, 1) he be permitted to change the Joint and Survivor annuity (50%) form of pension benefit which he elected at the time he was married to Jessica and prior to his retirement and Annuity Commencement Date; 2) Jessica receive no Surviving Spouse Benefits if she survives him; and 3) he be allowed to name a new spouse beneficiary of his pension benefit should he remarry. (AR 19, 38.) As discussed fully below, ERISA and interpreting Fourth Circuit case law preclude Setzer's request. “Under ERISA Section 205, 29 U.S.C. §1055(a)(1), a pension plan must provide that "in the case of a vested participant who does not die before the annuity starting date, the accrued benefit payable to such participant shall be provided in the form of a qualified joint and survivor annuity . . . ." (Id.) ERISA defines "qualified joint and survivor annuity" to mean an annuity “(A) for the life of the participant with a survivor annuity for the life of the spouse which is not less than 50 percent of (and is not greater than 100 percent of) the amount of the annuity which is payable during the joint lives of the participant and the spouse, and “(B) which is the actuarial equivalent of a single annuity for the life of the participant. “29 U.S.C. §1055(d)(1). “In accordance with ERISA, the Plan in the present matter provides that "the mode of payment to a Married Participant whose retirement Pension commences upon his retirement on a Retirement Date" and is the actuarial equivalent of the regular pension benefit for an unmarried participant "payable as a reduced monthly retirement Pension for the Married Participant for life commencing on his Retirement Date with the provision that fifty percent (50%) of his reduced retirement Pension shall be continued to and during the life of his spouse, if his spouse is living at the time of his death. . . ." (Plan at 79.) “In pertinent part, the Plan defines Married Participant as "a Participant who is lawfully married on the earlier of his or her Annuity Commencement Date, or the date of his or her death." (Plan at 63.) Under the Plan, the Annuity Commencement Date is defined as "the first day of the first month for which an amount of Pension is payable to such Participant or Beneficiary as an annuity. . . ." (Plan at 55.) Setzer's Annuity Commencement Date was December 1, 2004, which is the same date as his retirement. (AR 40.) Setzer was married to Jessica on December 1, 2004. (AR 31.) Thus, Setzer was a Married Participant under Plan terms. “A Married Participant "may elect during the Election Period not to receive his retirement Pension in the mode of a joint and survivor benefit . . . ." (Plan at 81.) The Plan defines the "Election Period" as the ninety (90) day period ending on the Participant's Annuity Commencement Date.[5] (Id.) Thus, under Plan terms, Setzer could have elected (with Jessica's consent) to forgo the Joint and Survivor form of benefit payment if he had made the election to do so during the Election Period, which ended on December 1, 2004. (Plan at 81.) Setzer did not make such an election; rather, he elected the Joint and Survivor 50% annuity form of benefit, and he named his wife Jessica as his Plan beneficiary to receive the Surviving Spouse Benefits. (AR 30-31.) Moreover, under the Plan, if Setzer had divorced Jessica prior to his Annuity Commencement Date, he could have canceled the form of benefit elected. (Plan at 80; "In the event that a Married Participant ceases to remain married, due to divorce . . . prior to the Participant's Annuity Commencement Date, the coverage elected by the Participant under Section 6.2 "shall be canceled as of such date. . . .") [Note that Jessica’s right to a survivor annuity could have been reinstated by a QDRO.] (Emphasis and comment supplied.) “Setzer, however, did not divorce Jessica until more than five years after his Annuity Commencement Date. In Hopkins v. AT&T Global Information Solutions Co., 105 F.3d 153 (4th Cir. 1997), the Fourth Circuit directly addressed the question of when a surviving spouse benefit vests in a participant's spouse. The Fourth Circuit concluded that under ERISA, "the Surviving Spouse Benefits vest in the spouse married to the participant on the date of retirement." Id. at 156. The Court went on to conclude that "nless the form of benefit is properly changed prior to retirement, the participant is locked into the joint and survivor annuity upon retirement . . . [and] cannot change the form of benefit, even with the current spouse's consent." Id. at 157. Here, the vesting of the Surviving Spouse Benefits occurred on December 1, 2004, the date of Setzer's retirement and commencement of benefits. Consequently, as a matter of law, Setzer cannot change the Joint and Survivor form of benefit, even though Jessica purported to waive any claim or interest she might have in Setzer's pension benefits. “ERISA requires "[e]very employee benefit plan [to] be established and maintained pursuant to a written instrument," 29 U.S.C. § 1102(a)(1), "specify[ing] the basis on which payments are made to and from the plan," § 1102(b)(4). "The plan administrator is obliged to act `in accordance with the documents and instruments governing the plan insofar as such documents and instruments are consistent with the provisions of [Title I] and [Title IV] of [ERISA],' § 1104(a)(1)(D), and ERISA provides no exemption from this duty when it comes time to pay benefits." Kennedy v. Plan Adm'r for DuPont Sav. and Inv. Plan, 555 U.S. 285, 300 (2009). In sum, ERISA requires that the Appeals Board follow the Plan terms. Under the Plan terms and in accordance with the law, a Married Participant may not change the elected form of benefit after the Participant's Annuity Commencement Date. “In his Memorandum in Support of Judgment, Setzer maintains that the Plan wrongly denied his request in light of Jessica's refusal of the benefit and believes the Plan documents' use of the phrase "may not" instead of "cannot" leaves room for the Plan to authorize the change requested. (ECF No. 25 at 3.) Setzer also argues that the Plan's position fails to distinguish between a beneficiary who has died and a beneficiary who has refused a benefit, and therefore creates the "absurd result" of forcing a beneficiary to take benefits she does not want. (ECF No. 25 at 4.) Setzer's arguments are simply unavailing and fail to account for the operation of the controlling law and the discretion of the Appeals Board in interpreting the Plan's governing language. Contrary to Setzer's assertions, nothing in the Plan's terms forces Jessica to take the Surviving Spouse Benefits if she does not want them and the Plan is "statutorily required to distribute benefits in accordance with the documents on file." Boyd v. Metropolitan Life Ins. Co., 638 F.3d 138, 141 (4th Cir. 2011) (citing Kennedy v. Plan Adm'r for DuPont Sav. and Inv. Plan, 555 U.S. 285, 299-300 (2009). Further, the Fourth Circuit squarely addressed and rejected Setzer's core argument in Boyd by carefully considering the key language in Kennedy and concluding that a beneficiary who has relinquished his or her interest in certain proceeds by way of a divorce decree or otherwise, "ha every chance to waive his right and refuse the. . . proceeds." Boyd, 638 F.3d at 143; see also Matchiner v. Harford Life & Accident Insurance Co., 622 F.3d 885, 888 (8th Cir. 2010)(noting that while the plan at issue did not set forth any formal procedures for waiver, the "plan documents and not the divorce decree are controlling"). As the Fourth Circuit noted in Boyd, it is the plan administrator's role to follow the Plan documents in distributing benefits and the enforcement — the interpretation of personal divorce decrees and separation agreements are ultimately not matters for the plan administrator's concern. Id. at 145. This Court cannot grant Setzer's request to reject the Plan's clear terms and "unwind Kennedy and make a puzzle of plan administration," where "Congress has provided an alternative that is simultaneously clearer and more sensible." Boyd, 636 F.3d at 145. “Thus, this Court concludes that in making its decision, the Appeals Board followed the language, purpose and goals of the Plan in light of the procedural and substantive requirements of ERISA and controlling law.” >>>>>>>>>>>>>>>>>>>>>> Bottom line is that the Alternate Payee in the case at issue can be awarded a share of the retirement annuity via a QDRO, but the 75% survivor annuity for the Alternate Payee cannot be changed except by a waiver, and I think that ship has sailed. It might be possible to mollify the ex-husband in this case by reducing the Alternate Payee's share of the retirement annuity to a percentage less than 50% in order to allocate 1/2 of the cost of the survivor annuity to her. That would be fair. David Goldberg

Two things in life are ubiquitous. First, yellow taxis in Manhattan. Second, the use of the time rule formula for allocating an ERISA qualified defined benefit plan for an employee who is still working, using a "shared" formula, a/k/a "Bangs/Pleasant" formula in Maryland, a/k/a "Brown Formula" in California, a/k/a pro-rata formula re: FERS and CSRS - 5 CFR § 838.621. Thus, your standard shared interest allocation for a defined benefit plan: "The Alternate Payee is hereby awarded 50% of the "marital share" of the Participant's retirement annuity benefit if, as and when paid to the Participant. The "marital share" is determined by a fraction, the numerator of which is the number of months during the marriage that the Participant accrued creditable service in the plan, and the denominator is the number of months that the Participant accrued creditable service in the plan at the time of his commencement of benefits." Now we have Fidelity on it's website, setting forth 10 Northrop Grumman defined benefit plans with respect to which they offer only two allocation options: See page 40, line 3 of the attached. " ______% (insert percentage) of each of the Participant’s monthly benefit payments from the Plan. $_____ (insert dollar amount) of each of the Participant’s monthly benefit payments from the Plan." Note the absence of a time rule option for defining the amount to be paid to the Alternate Payee. I now have another attorney telling me that I cannot change the model QDRO to insert a time rule option AND must wait until the Participant actually retires to prepare and submit the QDRO - likely about 20 years in the future. Say what? 26 IRC Section 414(p)(2) sets forth everything needed for a valid DRO: "(2)Order must clearly specify certain facts: A domestic relations order meets the requirements of this paragraph only if such order clearly specifies— "(A) the name and the last known mailing address (if any) of the participant and the name and mailing address of each alternate payee covered by the order, "(B) the amount or percentage of the participant’s benefits to be paid by the plan to each such alternate payee, or the manner in which such amount or percentage is to be determined, (Emphasis provided.) "(C) the number of payments or period to which such order applies, and "(D) each plan to which such order applies." BUT, hold on, if the Participant remarries and then retires, his new wife becomes irrevocably vested in the survivor annuity and the intended Alternate Payee can never get it....PERIOD. See the 1997 decision of the US Court of Appeals, 4th Circuit, in Hopkins v. AT&T Global Information Solutions at http://scholar.google.com/scholar_case?case=9954117838131396049&q=hopkins+at%26T+global&hl=en&as_sdt=2,9 followed by the 5th Circuit in 1999 Rivers v. Central and South West Corporation at http://scholar.google.com/scholar_case?case=2296953953561556363&q=rivers+central+and+south+west&hl=en&as_sdt=2,9: “This Circuit agrees with the Fourth Circuit's decision in Hopkins and adopts its rationale. Rivers failed to protect her rights in Franklin's pension plan by neglecting to obtain a QDRO prior to Franklin's retirement date. Consequently, Franklin's pension benefits irrevocably vested in Mrs. Franklin on the date of his retirement and Rivers is forever barred from acquiring an interest in Franklin's pension plan.” To the same effect see Dahl v. Aerospace Employees’ Retirement Plan, a 2015 case from the U.S. District Court for the Eastern District of Virginia (and cases cited therein) - https://scholar.google.com/scholar_case?case=3487596170773082469&q=dahl+v.+aerospace&hl=en&lr=lang_en&as_sdt=20000003&as_vis=1 Other cases following Hopkins are collected at: https://scholar.google.com/scholar?start=0&q="Hopkins+v.+AT%26T"&hl=en&as_sdt=20000006 I have changed Fidelity forms like this many times and inserted a time rule formula and it was accepted by the Plan. Can anybody cite an IRC/ERISA code provision, or a case decision, or any treatise, that would be contrary to my universal experience that time-rule formulas are acceptable as a method if defining the amount of the Alternate Payee's defined benefit annuity, and that a Plan Administrator/TPA cannot limit the options available? Thanks for your insight. David N-G Shared QDRO Package 42 pages 2019.pdf

It has become common in our social media world the equate the use of ALL CAPS BOLD as somehow shouting or using aggressive language. I have used it for a very long time only for the purpose of making my interlineations NOTICEABLE. Nobody that knows me would imagine that I was shouting at anyone. Now you know. So you will no longer misinterpret my intentions. So far as the "demanding" accusation is concerned, if someone is going to ask for my assistance I expect that they will provide the information and documentation I need to provide that assistance, especially when I am doing so gratis. These are people with issues dealing with what, for most people, is one of their two highest value assets. It is not too much to expect them to cooperate. I am the founder and moderator or a family law listserv in Maryland with about 1,470 family lawyers. They all know that if they post a question I will hold them to the high standards that were set for me by the Jesuit priests I was lucky enough to have as professors at Georgetown Law, and the United States District Court judges I encountered in DC and Maryland; including a health dose of the Socratic method. David

The first sentence of his post included, "My ex- wife received a portion of my annuity (via the first executed QDRO)". In my world an annuity is usually a pension, that is, a defined benefit plan. Although it can be an annuitized payout of a defined contribution plan, that is very rare in my 30+ years of experience. You cannot say that she was awarded a portion of my annuity but not a portion of my pension . I don't this our guy knows what she was awarded at any point in his case. I have learned not to believe anything my clients tell me. They cannot set forth a question without having the vocabulary or the underlying knowledge to do so. We could likely answer his question if we saw a copy of both QDROs and the underlying Judgment of Divorce or written Agreement. Otherwise we are wasting our time trying to have him explain matters that he himself cannot comprehend or explain. Perhaps the Court entered a revised QDRO to address matters that WERE included in the Agreement or Judgment of Divorce but were inadvertently omitted from the first QDRO. Maybe the court issued a nunc pro tunc order to clarify it's intent. Maybe, as I suggested, the first Order was not submitted to the Plan or was submitted but not qualified and the 2nd QDRO is not much different from the first. My colleagues, or clients they refer, regularly call with questions that I cannot answer without seeing the proposed QDRO, the written Agreement and Judgment of Absolute Divorce, the docket entries, the SPD, the correspondence from the Plan Administrator, and more. They are annoyed that I just don't immediately know the answer. And 100% of the time the question they first pose is not the issue at all. It's like calling your doctor and saying "Doc: I have a stomach ache. What do you recommend?" A doctor friend tells me that there are 250 illnesses or conditions that can cause a stomach ache. David

Not much I or anyone can do to help you if you do not answer my questions. A 401(k) is NOT an annuity no matter what they call it. You need to hire a lawyer who if familiar with these issues, and furnish him/her with copies of all relevant documents.

See my comments in ALL CAP BOLDED. (NYS) My ex- wife received a portion of my annuity (via the first executed QDRO), WHAT IS THE EXACT NAME OF THE PLAN medical benefits through me for life, and cash as part of our divorce settlement in the 90s. The QDRO was signed by all parties, the judge, and filed. WHAT DO YOU MEAN BY "FILED", AND WITH WHOM WAS IT FILED? WAS A CERTIFIED COPY SENT TO THE PLAN ADMINISTRATOR? WAS IT APPROVED BY THE PLAN ADMINISTRATOR? Flash forward to now. we WHO IS "WE"? recently began to process of receiving my pension and annuity DID YOU EX WIFE START TO GET HER SHARE FOR YOUR "PENSION AND ANNUITY"? WHAT DO YOU MEAN BY "PENSION AND ANNUITY"? DID YOU HAVE A PENSION AND DEFERRED COMPENSATION PLAN THAT WAS TO BE PAY OUT AS AN ANNUITY ON RETIREMENT? WAS THERE ONE PLAN OR TWO? and my union demanded we send a waiver for signature to my ex wife. She refused to sign, lawyered up, and filed another DRO (already accepted by the plan administrators) with the judge who has also signed and delivered the papers on to me. WHAT I THINK HAPPENED IS THAT THE PLAN ADMINISTRATOR KNEW YOU WERE DIVORCED, KNEW THAT THERE WAS AN AGREEMENT OF SOME SORT AND WANTED THE WIFE TO SIGN OFF AND WAIVE IT SINCE THERE WAS NO CONFIRMING QDRO. AND I THINK YOUR WIFE DISCOVERED THAT THE ORIGINAL QDRO WAS NOT SENT TO OR APPROVED BY THE PLAN AND THAT THE "NEW" QDRO IS ACTUALLY A CERTIFIED COPY OF THE ORIGINAL QDRO. OR THE OTHER OPTION IS THAT THERE WERE TWO PLANS TO WHICH SHE WAS ENTITLED AND YOU ONLY DID THE QDRO FOR ONE. SOME UNIONS, FOR EXAMPLE, FOR ELEVATOR UNION MEMBERS HAVE TWO PLANS, ONE IS CALLED A "PENSION PLAN" AND THE OTHER IS CALLED AN "ANNUITY AND 401(K) PLAN". THE LATTER IS NOT AN ANNUITY. I would like to fight this, as I’ve seen the chances of her winning aren’t great, and want to know what the logical and rational response to the judge should be. id planned to file a motion indicating, among other things, that the pension was NOT a part of the divorce settlement. YOUR PENSION IS AN ANNUITY AND YOU SAID SHE WAS TO GET PART OF YOUR ANNUITY, SO IT WAS PART OF THE DIVORCE SETTLEMENT YOUR LACK OF FAMILIARITY WITH THE LANGUAGE IN THIS AREA OF THE LAW CAUSES YOU TO STRUGGLE IN COMMUNICATING THE SITUATION AND US TO STRUGGLE TO UNDERSTAND WHAT IS HAPPENING. no minor children involved... any help will be greatly appreciated!

There are 980,000 different ERISA qualified pension and retirement plans in the US. Add Federal, State, County, City, and municipal plans and international plans. The information you are looking for is Plan specific, not State specific. ERISA and Federal plan preempt state law with regard to most pension and retirement matters. You need to contact the Plan Administrator of the Plan in question and ask them for their "QDRO package" setting forth their unique requirements, language preferences, and procedures. Note that the Plan may have a Third Party Administrator (TPA) who handles QDRO matters for the Plan and the Plan Administrator can refer you to the TPA. If you have a period statement of benefits and find Fidelity, Vanguard, Mass Mutual, Alight, Voya, T. Rowe Price, etc. you can be almost certain that a TPA is handling the matter, but it may be that these firms are just handling the investment aspect of the Plan but not the QDRO aspects. Note that ERISA Section 206(d)(3)(G)(ii) requires sponsors of qualified retirement plans to maintain written procedures for the administration of qualified domestic relations orders (“QDROs”), and the Plan Administrator has an obligation to ensure that a domestic relations order received by the plan is “qualified” before making the payments or taking other actions contained in the order. The written procedures will can and should be drafted to reflect the terms of the Plans that the Employer/Sponsor maintains. This will help avoid the time consuming, costly, and sometimes frustrating process of modifying a draft QDRO to make sure that it does not require a form of distribution (or confer other rights) not allowed under the Plan document. Written procedures will: (i) Support more efficient review and helps to ensure that the parties will get the basics right and this will expedite the approval process; (ii) Avoid unnecessary expense and frustration by cutting down on the number of drafts that must be exchanged and minimizing confusion and delay. The Plan Administrator may or may include a model order, but there is no guarantee that such an order will comply with the law of your state and with the intention of the parties as set forth in their written Agreement, or of the Judge as set forth in the Judgment of Divorce. Use a model order at your peril. Attached is an excerpt from Gary Shulman treatise, "Dividing Pensions in Divorce". I would recommend that you purchase this book and it's companion, "Qualified Domestic Relations Order Handbook", both published by Aspen. If you want to find out who the Plan administrator is look at the Form 5500 filed by the Plan with the Department of Labor, Employment Benefits Security Administration every year. You can find it at https://www.efast.dol.gov/portal/app/disseminate?execution=e1s1 Go forth and make sure your malpractice insurance is adequate to the risk you are undertaking in entering this area of the law. It's easy to mess up and it's easy to get sued and sanctioned by the Bar for messing up. Sorry to sound harsh. This is a highly esoteric are of the law, so you might consider working with an experienced QDRO attorney for a while before striking out on your own. David QDROs - Model QDRO Dangers.pdf

From a strictly legal perspective, a "trustee", whether individual or corporate, acts for and on behalf, and for the use and benefit, of the beneficiary/cestui-que trust. The trustee, as a fiduciary, may be vested with administrative responsibilities and may be authorized to make investment decisions, but the trustee holds bare legal title for the beneficiary who is the equitable owner of the trust property. So it seems to me that no matter how one tries to look at the issue, a 401(k) Plan Participant owns the assets in his account, and if he borrows from that account he has removed his own assets, and when he pays the money back with interest he replenishes his own assets. I have never fully understood the purpose of charging interest since it increases the value of the account and does not, or should not, enrich anyone else. It is axiomatic that a trustee cannot appropriate the assets of the trust to himself. But I live in the QDRO world and I don't have to worry about fictions and non sequiturs and the often inexplicable workings of ERISA. Pax vobiscum.

Now THAT I understand. Thank you kind sir. David

I don't spend much time on this issue, but have always thought that you were paying interest to yourself (while knowing the down sides). Perhaps I am simply naive, but > https://www.listenmoneymatters.com/401k-loan/ “Borrowing against your 401K means, you are borrowing from yourself. Unlike borrowing from a bank, the interest you pay, you pay to yourself. The amount you borrowed is no longer invested so rather than getting investment gains; your “gain” is the interest you pay back.” > https://www.investopedia.com/articles/retirement/08/borrow-from-401k-loan.asp “Another confusing concept in these transactions is the term "interest." Any interest charged on the outstanding loan balance is repaid by the participant into the participant's own 401(k) account, so technically this also is a transfer from one of your pockets to another, not a borrowing cost or loss. As such, the cost of a 401(k) loan on your retirement savings progress can be minimal, neutral, or even positive. But in most cases, it will be less than the cost of paying "real interest" on a bank or consumer loan.” > https://www.kitces.com/blog/401k-loan-interest-to-yourself-opportunity-cost-tax-rules/ “A unique feature of a 401(k) loan, though, is that unlike other types of borrowing from a lender, the employee literally borrows their own money out of their own account, such that the borrower’s 401(k) loan repayments of principal and interest really do get paid right back to themselves (into their own 401(k) plan). In other words, even though the stated 401(k) loan interest rate might be 5%, the borrower pays the 5% to themselves, for a net cost of zero! Which means as long as someone can afford the cash flows to make the ongoing 401(k) loan payments without defaulting, a 401(k) loan is effectively a form of “interest-free” loan.” > https://www.thebalance.com/facts-about-401k-loans-2388811 “You will pay yourself interest: The interest rate on your 401(k) loan is determined by the rules in your 401(k) plan. The interest rate is typically set up as a formula, such as "Prime + 1%". You pay the interest back into your own 401(k) account balance.” > https://www.fidelity.com/viewpoints/financial-basics/avoiding-401k-loans “One of the advantages of a 401(k) loan over other types of borrowing is that you pay yourself back with interest. One downside is that the interest may not keep pace with the potential investment return. You may miss out on potential market growth and investment compounding while some of your loan balance is outside the account and not invested.” > https://www.finra.org/investors/learn-to-invest/types-investments/retirement/401k-investing/401k-loans-hardship-withdrawals-and-other-important-considerations “On the plus side: You usually don’t have to explain why you need the money or how you intend to spend it. You may qualify for a lower interest rate than you would at a bank or other lender, especially if you have a low credit score. The interest you repay is paid back into your account. Since you’re borrowing rather than withdrawing money, no income tax or potential early withdrawal penalty is due.” So I really don't get it. No matter what fictions* may exist with respect to who is actually making the loan, and whose money is the source of funding for the loan, and who is receiving the interest on the loan, it seems to me that the practical bottom line answer is that the account holder is borrowing from himself and is paying himself back with interest and that the interest is going to him as well. N'est-ce pas? *Fiction - a belief or statement that is false, but that is often held to be true because it is expedient to do so. David

David: Does the Plan get the interest on the loan payback? I have never heard that to be the case. The borrower loses market gains on the amount borrowed, but the interest is paid back to and credited to the borrows 401(k). I don't think it first passes through the Plan's bank account. That being the case, how can it logically be deemed to be an investment of the plan. You can call a horse a chicken, but it's still a horse. But wait. I forgot that useful word "deemed" that would allow you to "deem" the horse to be a chicken without having to deal with the intellectual dishonesty of that assertion. Are you are looking at para. (b) of - https://www.law.cornell.edu/cfr/text/26/1.72(p)-1, and maybe Q-19 and A-19. Or some other section? Madness!! - from Bridge on the River Kwai -

Tell him it will take you 18 months to determine if the QDRO is "qualified". Have a medic ready.

In response to "Golfing", the fiduciary owes an obligation to both the Participant and to the Alternate Payee as a beneficiary under 29 USC 1002(8). Check out Sun Life Assurance Company v. Jackson, Case No. 3:14-cv-41, United States District Court, S.D. Ohio Western Division (September 19, 2018) available at - https://scholar.google.com/scholar_case?case=1364917141727116905&hl=en&lr=lang_en&as_sdt=20006&as_vis=1&oi=scholaralrt&hist=bY5nDLcAAAAJ:17102308171145443235:AAGBfm2dXJvPo0nUQKlDLqIPUBXxyXMitw An excellent case dealing with the guidelines for an award of attorney fees against an ERISA qualified Plan to a participant, beneficiary or fiduciary. Also, a good discussion of pre-judgment interest. Under 29 USC 1132(a)(1)(B) a participant or an alternate payee (who is classified as a beneficiary), can sue "to recover benefits due to him under the terms of his plan, to enforce his rights under the terms of the plan, or to clarify his rights to future benefits under the terms of the plan;" Under 29 USC 1132(e)(1) it states that: "(e)Jurisdiction(1)Except for actions under subsection (a)(1)(B) of this section, the district courts of the United States shall have exclusive jurisdiction of civil actions under this subchapter brought by the Secretary or by a participant, beneficiary, fiduciary, or any person referred to in section 1021(f)(1) of this title. State courts of competent jurisdiction and district courts of the United States shall have concurrent jurisdiction of actions under paragraphs (1)(B) and (7) of subsection (a) of this section." So I see the Plan as being a nice target for the litigious attorney. In my years of practice I only filed one lawsuit under this section, in the US District Court in Baltimore. The Plan of a large corporation had fired an employee for embezzlement (I never asked and he never told me if he did it or not) and deducted $20,000 from his 401(k) to reimburse the Sponsor's loss. I won the case, he received his $20k, and I was awarded $32,000 in legal fees. Nice day at the office. "Do you feel lucky punk?" ....Clint Eastwood as Dirty Harry.

If I, as the attorney for the Alternate Payee, send you, the Plan Administrator, a copy of the written Agreement of the parties, and/or a copy of the Judgment of the Absolute Divorce, what will you do? Suppose in my cover letter I tell you that the terms of the Agreement were incorporated into the JAD and that the language of the Agreement or the JAD satisfies the requirements of 29 U.S.C. §1056(d)(3)(c) and may be considered to be a QDRO, but that I and opposing counsel are working on a QDRO - and I send you and unsigned draft of the QDRO and suggest that it will be forthcoming shortly. I also suggest that you should take whatever actions are necessary to protect the Alternate Payee's interest from any actions by the Participant that would deprive the Alternate Payee of the benefits assigned in the Agreement/JAD/proposed QDRO, and that your failure to do so may involve you in a lawsuit for damages sustained by the Alternate Payee, breach of fiduciary interest, etc. First, I think the 18 months begins to run and the Plan has to make a determination of whether the Agreement or JAD in fact constitute a QDRO. Attached find a MSPB case dealing with a situation where the Former Spouse applied for a survivor annuity benefit under CSRS after the death of her former husband and without any COAP having ever been submitted to OPM before his death. It is not an ERISA case but demonstrates the lengths to which judicial tribunals have gone to protect the rights of Former Spouses/Alternate Payees. Before this case those of us who prepared CSRS and FERS Orders were of the opinion that if the COAP was not in OPM's hands prior to the death of the Employee, the Former Spouse would be SOL. This is no longer true. And keep in mind that under the Pension Protection Act of 2006 post mortem ERISA QDROs can be enforced despite not having existed prior to the death of the Participant. If I were a Plan Administrator, Files v. ExxonMobil Pension Plan, 428 F. 3d 478 (2005), that you can find at - https://scholar.google.com/scholar_case?case=16381733883965097154&q=Files+v.+ExxonMobil+Pension+Plan,+428+F.+3d+478+&hl=en&lr=lang_en&as_sdt=20003&as_vis=1 would make me very nervous. As in the Eagles song, Hotel California, "They stab it with their steely knives, but they just can't kill the beast". Second, I think that if I were advising my client I would say that under the circumstances, I would not take any action. I would not want to see the client become the test case to determine the time and circumstances under which the Plan Administrator must put a freeze on the Participant's interest. I had a case recently where the parties were divorced in 2004. The wife was to get a share of her ex-husband's defined contribution plan and a survivor annuity benefit. No QDRO was ever submitted to the court. She found out in 2016 that he was planning to retire and wrote a letter to the Plan Sponsor with a copy of the JAD asking about the amount of her share. The Plan advised the Participant that they would not make any distributions to him unless and until they had a certified copy of a QDRO in hand. This is not an uncommon occurrence. Petrimoulx case (1).pdf

If it helps, here is a Memo I prepared for the members of my DSGfamily listserv dealing with the issue of when a Judgment of Absolute Divorce (with or without an incorporated Marital Settlement Agreement) can constitute a valid QDRO. See attached. David JAD = QDRO.pdf

A number of the posts in this thread seem to focus on the question of whether or not the amount awarded from a defined contribution plan will be subject to gains, losses and investment experience from the "valuation date" to the date of transfer to the Alternate Payee (via tax free rollover or taxable distribution, as the case may be) or the segregation of the Alternate Payee's benefits by the Plan before such transfer. Here is a Memo I prepared for my colleagues here in Maryland. Gains, Losses, Ownership Interest and Constructive Trust.pdf

Here's how you can make the husband happy and save him some money. First, the Plan is not going to distribute anything to anybody now that they know there is an Agreement that I assume was incorporated in the Judgment of Absolute Divorce. They will insist on a QDRO so like it or not a QDRO will be necessary. Second, if the QDRO is issued by the Court giving 50% to his ex-wife then at that point he can take out his 50%. BUT, the ex-wife's 50% will be taxable income to her but will not be subject to the 10% early distribution penalty. AND, his half will be taxable income to him and, if he is under 59-1/2. it WILL be subject to the 10% penalty. Third: Assuming he is under 59-1/2 and therefore subject to the 10% penalty, the parties should amend the Agreement to give her 100% ot the 401(k) and provide that she will divide the net after tax amount she received 50/50 with the husband. That will save both of them the 10% penalty. And there are no tax consequences to the transfer from her to him. I have done this on may occasions to get money into the hands of the Participant penalty free. And the law is clear that the Plan Administrator is not required, or even allowed, to look behind the motivations of the parties. My favorite case is In Brown v. Continental Airlines, Inc., 647 F. 3d 221 (5th Cir., 2011) https://scholar.google.com/scholar_case?case=4019345202025914766&q=brown+v.+continental+airlines&hl=en&as_sdt=20000003 Continental alleged that a number of pilots and their spouses obtained "sham" divorces for the purpose of obtaining lump sum pension distributions from the Continental Pilots Retirement Plan that they otherwise could not have received without the pilots' separating from their employment with Continental. The pilots were allegedly acting out of concern about the financial stability of Continental and the fear that the Plan might be turned over to the PBGC and that their retirement benefits would be substantially reduced. By getting divorced, the pilots were able to obtain QDROs from state courts that assigned 100% (or, in one instance, 90%) of the pilots' pension benefits to their respective former spouses. The Plan provides that, upon divorce, if the pilot is at least 50 years old (as all the pilots in this case were), a former spouse to whom pension benefits are assigned can elect to receive those benefits even though the pilot continues to work at Continental. (Think “separate interest” annuity allocation.) The former spouses presented the QDROs to Continental and requested payment of lump-sum pension benefits. After the former spouses received the benefits, the couples remarried. Continental sought to obtain restitution under ERISA Section 502(a)(3). The Court of Appeals noted that ERISA § 206(d)(3) limits the QDRO qualification determination to whether the state court decree calls for benefit payments outside the terms of the Plan. It rejected Continental’s expanded reading of § 206, concluding that plan administrators may not question the good faith intent of Participants submitting QDROs for qualification. But the opposite may be true in U.S. v. Brazile, No. 4:18CV56 RLW, United States District Court, E.D. Missouri (2018) - that you can find at - https://scholar.google.com/scholar_case?case=10011356851935590761&hl=en&lr=lang_en&as_sdt=20006&as_vis=1&oi=scholaralrt&hist=bY5nDLcAAAAJ:14880692104701005079:AAGBfm2qi1_JaXLJvydb4f3quYTnTlLkbA, where Steven Brazile was convicted of securities fraud and, as part of his plea agreement with the Government, he acknowledged owing restitution in the amount of $3,902,880.85. The Government imposed a lien against his property and rights to property under 18 U.S.C. § 3613(c). It seems that among Steven’s assets was a pension plan. Steven’s wife, Lorraine, filed suit for divorce and as part of the settlement the parties agreed to the entry of a QDRO transferring 100% of the plan benefit to Lorraine, thereby putting this asset unavailable for Steven’s restitution obligation. “ In September 2017, probation officers conducted a home visit at Defendants' home and discovered that Steven Brazile and Lorraine Brazile are living together with their children and are raising their kids together as a "family." (Id. at ¶ 28) The Government contends that this demonstrates that the Defendants entered into a "sham divorce" to transfer assets to Defendant Lorraine Brazile that could have been used to pay victim restitution. (Id. at ¶ 29) On January 12, 2018, the Government filed a three count civil Complaint against Defendants alleging fraudulent transfer in violation of 28 U.S.C. § 3304. (Id. at ¶¶ 30-44).” The case came before the court on Steven and Lorraine’s motions to dismiss or for summary judgment. The judge allowed the case go forward.

One of the leading experts in QDRO matters, Marshal Willick, practices in Las Vegas. Maybe he will take a look at your case without charging you. You can find him at https://www.willicklawgroup.com/marshal-s-willick-esq/ Mention my name. The following may help. I am attaching a Memo I prepared for the Bar in Maryland that confirms the proposition that it is not necessary for both parties to consent to the entry of a QDRO. One of the documents I reference is a Department of Labor pamphlet dealing with QDROs where it states at Question 1.2, 6th paragraph on page 5: "There is no requirement that both parties to a marital proceeding sign or otherwise endorse or approve an order." [ERISA §§ 206(d)(3)(B)(ii), 514(a), 514(b)(7); IRC § 414(p)(1)(B)] The law in Nevada may be the same,. See Mack v. Estate of Mack, that you can find at - https://scholar.google.com/scholar_case?case=2457338442981582706&q=must+both+parties+sign+qdro&hl=en&as_sdt=4,29 where in 2009 the Supreme Court of Nevada approved an oral QDRO which obviously was not and could not have been signed by the parties. In fact, The language of the Court was: " The district court issued a valid QDRO during Charla's lifetime. In the January 9 hearing, Judge Weller stated that within 48 hours, "a QDRO will be executed which will transfer to Mrs. Mack the sum of five hundred thousand dollars with any appreciation that is distributed to that five hundred thousand dollars and more or less equal installments over a period of five years." Here, the court issued a QDRO, because Judge Weller's oral order created a recognized existence in Charla, the right to receive a portion of Darren's ERISA pension plan. See id. § 1056(d)(3)(B)(i)(I). Because the district court issued a DRO, which was qualified, and it recognized Charla as an alternate payee with the right to receive a $500,000 payment from Darren's ERISA pension plan, we conclude that the QDRO was valid and affirm the order of the district court." So if the impediment in your case is the need to have the QDRO signed by both parties, the foregoing should be evidence that it is not necessary. Once again, the purpose of the QDRO is to IMPLEMENT the written Agreement of the parties, or, if they parties did not agree, the Order of the Court allocating pension and retirement benefits must likely issued in the Judgment of Divorce. Good luck David QDROs by DOL.pdf DSG Memo - SIGNATURE OF BOTH PARTIES ON QDRO.pdf

In Kari E. Kennedy, Executrix v. Plan Administrator for Dupont Savings and Investment Plan, 129 S.Ct. 865 (2009) which you can find at - https://scholar.google.com/scholar_case?case=16253581861885772265&q=KENNEDY+V.+DUPONT&hl=en&lr=lang_en&as_sdt=20003&as_vis=1 the Supreme Court of the United States held that you don't need a QDRO to waive an interest in a Plan, but that, in fact: "In fact, a beneficiary seeking only to relinquish her right to benefits cannot do this by a QDRO, for a QDRO by definition requires that it be the "creat[ion] or recogni[tion of] the existence of an alternate payee's right to, or assign[ment] to an alternate payee [of] the right to, receive all or a portion of the benefits payable with respect to a participant under a plan." 29 U.S.C. § 1056(d)(3)(B)(i)(I). There is no QDRO for a simple waiver...." So the waiver you seek should be set forth in the Marital Settlement Agreement, and in your case, it wouldn't hurt if the Judgment of Absolute Divorce contained language that would provide the Plan Administrators with something to put in their files to show such a waiver if needed for the unique laws of California re: community property. If the JAD doesn't contain that language, just furnish a certified copy to the Plan Administrators, explain the situation and ask if they need anything else. Normally any ERISA entitlements that one party has in the pension or retirement benefits of a Plan Participant die with the marriage unless preserved in a QDRO, or unless a party has retired prior to divorce and the Alternate Payee's survivor benefit rights have been confirmed. See Hopkins v. AT&T Global Information Solutions Co., 105 F.3d 153 (4th Cir. 1997) A "QDRO" is not required for a transfer of IRA funds since IRA are not a Plan under ERISA. The proper name is a "Retirement Benefits Order", but most (but not all) IRA custodians feel that NO Court Order is required. The are satisfied if the parties fill our their forms and provide a copy of the JAD and the MSA. But be careful, some states, including Maryland, do not authorize a transfer of retirement account balances except in connection with and incident to a divorce or annulment. Just because Federal law permits a transfer to a "spouse or former spouse" (IRC 401(d)(6)) does not mean that the court has the jurisdiction to do so. The tax and penalty risks if a transfer is made without proper jurisdiction are all on the IRA account holder. So check your state law. David Goldberg