QDRO earnings calculation

[Guest Achilles]

I have a QDRO that states that the alt. payee is to receive a flat dollar amount, based on the partic. account balance from two years ago.

Up until the date of transfer, the QDRO states to add in any gains and minus any losses, but only gains and losses associated with the flat dollar amount to receive.

Here is what I know:

Partic. Beginning balance 6/9/07 $75,000.00

Alternate payee portion $27,000.00

Partic. remaining portion $48,000.00

Partic. cont's 6/9/07 - current day $20,000.00

Net G/L 6/9/07 - current day ($21,000.00)

Ending acct. balance $74,000.00

Does anyone know of a QDRO calculator on the web that could help me determine what portion of the ($21,000) loss is attributable only to the alt. payee's $27,000 to receive?

I've looked at this a couple ways - one, treating it as if alt. payee's portion were an ADP refund. Another way was this calculation:

Partic. Balance portion after split $48,000.00

Partic. Cont's 6/9/07 - current day $20,000.00

Sum $68,000.00 Dollars from the participant that make-up the ending balance.

This sum / ending acct bal. = 91.89% 68,000 / 74,000

91.89% of net G/L = ($19,297.30) Partic's share in G/L 91.89% * (21,000.00)

Alternate payee G/L portion = ($1,702.70)

[GMK]

I think you have to consider how you would do the calculation if there had been a gain and apply that method to the loss.

If there had been no gain or loss, the current date balances would be $27k for the AP and $68k for the participant. 28.4% belongs to the AP, and 71.6% belongs to the participant.

Now, if there had been a gain of $50k, I don't see how you would justify applying 92% of it to the participant's portion and only 8% to the AP?

The simple calculation is to apply 28.4% of the gain/loss to the AP and 71.6% to the participant.

A more 'accurate' approach would be to get out the old spreadsheet and allocate the gain/loss each time it was reported since 6/9/07, based on the AP's and participant's balances at each time the gain/loss was credited.

Just one opinion, and others probably have a better answer.

[Guest Eric.]

This may not thrill you too much, but if it were me, I'd crunch the numbers at each point a gain/loss hit the account (as GMK eluded to as a being the more "acurate" way).

[david rigby]

Agreed. That technique is much easier to defend.