Lisa7267

Does anyone know if the award instructions in a QDRO need to be clarified (e.g., the parties' intent regarding how to treat the loan balance, to include it or not in determining the balance), can the two divorcees submit a letter with both signatures?

Hello. I a faced with a unique beneficiary designation and my inclination is that it is not appropriate. The plan document allows for one or more primary beneficiaries to be named and one or more contingent beneficiaries if all of the primaries have predeceased the ppt (or disclaimed). We received a custom beneficiary designation that names one or more 2nd tier contingent beneficiaries to each of the contingent beneficiaries, meaning that if all of the primaries predecease, then the named contingents do not split the account equally as would normally be the case. Rather, the participant wants specific 2nd tier contingents to get any predeceased contingents' share. I can't find any information on this online and I was hoping someone had some prior experience with handling this issue. Thanks so much.

I have actually dealt with this multiple times. For any qualified retirement plan, pursuant to the Retirement Equity Act of 1984, if the participant is married and has not elected the spouse as the sole primary beneficiary, spousal consent must be obtained as witnessed by a notary or an authorized plan representative. The QJSA rules are irrelevant. The spouse can disclaim all or a portion of his or her benefits, but the disclaimer has to be valid under his/her state law (we refer the spouse to obtain legal counsel). Whatever portion is disclaimed is treated as if there is no beneficiary designation and the terms of the plan document kick in. As someone has previously stated, the anti-assignment clause of ERISA would not permit the spouse to name the person who would get the assets.