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QDRO - unsigned order


Guest friedbrain

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Guest friedbrain

Can an order which otherwise satisfies the Code and ERISA but is not signed by the judge be considered a QDRO? 2nd question: would it be considered a "reasonable procedure" if a plan administrator imposes a time limit on the amendment period for an order which initially fails to satisfy the QDRO reqs.? Is it correct to conclude that if an order is not determined to be a QDRO by the administrator within the 18-month period, the segregation req. is over and the administrator can allow the participant to take a distribution?

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1. No. An order is not an order unless it is signed by a judge.

2. What would the time limit be for? An order is either qualified or it is not. If it is not, the plan administrator says it is not, and then it is up to alternate payee to change it so that it is qualified. You couldn't put a time limit on that.

On the other hand you might be asking about the 18 month rule here. If you take the position that the status of the participant's benefit is unclear while the order is being revised, the plan could suspend payments to the participant during that period (up to 18 months) to the extent that those payments would have been required to be made to the alternate payee. This is the 18 month period - the plan is required to withhold payments to the participant to the extent they would have gone to an alternate payee for up to 18 months while the confusion about the order is being cleared up.

3. I suppose that you might consider the 18 months to be a time limit on getting the order right - if the order is still not qualified after 18 months the plan can release the payments to the participant. To be honest I've never had this situation and it raises many questions as I sit here typing. Ex. if the plan makes installment or annuity payments, do you just release the payments that have been suspended for an entire 18 months, or all payments that have been held up during the 18 months?

I guess that the 18 months is a period to clear up questions, but it is not indefinite - otherwise the former spouse could tie up the participant's account/benefits forever by submitting bogus orders.

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Whether something is a domestic relations order or not is a matter of state law and procedure. While it is conceivable that an unsigned oder or an order signed by a clerk is a domestic relations order, unless you are sure as a matter of applicable state law that the order is OK, don't accept it. It is good practice to require a copy of a DRO be certified by the court (or court clerk). A filing stamp, with a date or not, is not much assurance that the court has really issued the order. Mosk clerks of court will file anything that is put across the counter. Filing, by itself, has little or no legal meaning.

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Guest PeterGulia

The 18-month segregation period applies to a plan administrator's consideration of an order. Usually, a paper that is not signed by the Judge is not an order. If there is no order submitted to the plan administrator, there is no segregation.

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