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Force submission of QDRO


Guest rsusselj18

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Guest rsusselj18

A court ordered a QDRO share of my late husband's 401(k) to his ex-wife. It is for a finite, specified dollar amount. I am to receive the balance after she receives her share. I am both the named beneficiary as well as beneficiary under Federal ERISA rules.

She has submitted a QDRO twice and both times the QDRO was rejected based on technical incorrectness. However, since then she has not re-submitted a new QDRO. We have been asking them to do so with no result.

It is our belief that she is deliberately delaying the submission of the QDRO with the intention of waiting for the market to drop -- as is anticipated as a result of the situation in Japan (and elsewhere). She is actually very solvent financially and she would not mind a small loss. Her goal has been more along the lines of hurting me, rather than gaining more for herself. That she gains more for herself is but a side effect. (and NO, I did not break up their marriage -- it was broken before I met my husband and he was already divorced from her at the time, so I did nothing to deserve this -- she is just that kind of person, unfortunately).

Since I am NOT as solvent, and I NEED this money in order to live (for my future) I am quite concerned about this. Is there any way I can force the submission of a CORRECTED QDRO?

I had the idea that perhaps an appeal to the judge to assess penalties for the delay and/or for the submission of incorrect QDRO's might work.

what are my options here?

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One thing you could try is to ask the plan to segregate the specific QDRO amount for distribution to the ex when the ex files a qualified DRO, so the plan could distribute the remainder of the account to you as beneficiary now.

This is a quick (not thought through) idea, so it may have flaws. In addition, the plan may not go for it. But then, it might work for you.

Good luck.

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As a side issue that might help. You don’t mention what type of plan this is, or who controls the investments. But if this is a participant directed plan, for example a 401(k) plan your late husband could go on the web and change which funds the money was invested, as his beneficiary you should be able to get the power to change the investments. A pending QDRO won't change the fact you are the one with that power now.

So if you fear a serious market loss you should be able to get the ability to change the investment mix to one that meets your needs/risk tolerance.

You might want to seek out investment advice from an investment professional to help you find the right mix.

I realize this won’t help you get your portion of the money any quicker, but it might allow you to manage what you feel is a risk until the funds are paid.

If this is the type of plan one has no control over the investment mix--- disregard this message

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A court ordered a QDRO share of my late husband's 401(k) to his ex-wife. It is for a finite, specified dollar amount. I am to receive the balance after she receives her share. I am both the named beneficiary as well as beneficiary under Federal ERISA rules.

She has submitted a QDRO twice and both times the QDRO was rejected based on technical incorrectness. However, since then she has not re-submitted a new QDRO. We have been asking them to do so with no result.

It is our belief that she is deliberately delaying the submission of the QDRO with the intention of waiting for the market to drop -- as is anticipated as a result of the situation in Japan (and elsewhere). She is actually very solvent financially and she would not mind a small loss. Her goal has been more along the lines of hurting me, rather than gaining more for herself. That she gains more for herself is but a side effect. (and NO, I did not break up their marriage -- it was broken before I met my husband and he was already divorced from her at the time, so I did nothing to deserve this -- she is just that kind of person, unfortunately).

Since I am NOT as solvent, and I NEED this money in order to live (for my future) I am quite concerned about this. Is there any way I can force the submission of a CORRECTED QDRO?

I had the idea that perhaps an appeal to the judge to assess penalties for the delay and/or for the submission of incorrect QDRO's might work.

what are my options here?

I dont understand what is going on here. The plan adminstrator cannot hold up payment of benefits that are legally payable to a beneficiary which are not subject to a claim by an ex spouse. Under the rules for QDROS when the benefits are payable the potential amount that the ex is entitled to is supposed to be segregated (deferred) from the rest of the participant's account when the DRO is received. The plan administrator has 18 months to review the DRO to determine if the order is a QDRO and pay the benefits to the ex. If the order is determined to be QDRO within 18 months after the benefits are deferred then the segregated benefits plus interest are to paid to the ex spouse. If the plan administrator has not resolved the issue of whether the order is a QDRO after 18 months or has determined that the order is not a QDRO then the benefits are to paid to the beneficiary of the participant. Period. The plan administrator cannot refuse to pay any amount due a beneficiary that is not subject to the DRO.

You need to get the rules for QDROS from the plan administrator to see if the above rules have been followed. If the above rules have not been complied with or if more than 18 months has expired you should file a claim for the benefits that the ex requested under the DRO. As a separate matter you should immediately file a claim with the plan administrator for payment of the benefits of your late husband that were not subject to deferral (segregation) for possible payment to your ex, since those benefits are not subject to the claims of the ex. The plan administrator must respond to your claim in writing within 90 days. You need to have your counsel review the rules for filing a claim for benefits under section 503 of ERISA and reg 29 CFR 2560.503-1. You need to light a fire under the plan administrator by making him/her respond to your justified right to all benefits not segregated to the ex under the plan's QDRO procedure. You should also demand that the plan administror make you whole for any investment losses due the failure of the plan administrator to follow the QDRO rules or plan distribution rules for QDRO payments to the ex spouse.

mjb

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