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QDRO Transferrable from retirement plan to disability plan?

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I was divorced in 2003. Apparently in the divorce settlement I agreed to pay my ex wife 50% of both my retirement plan and disability plan. I don't remember agreeing to the disability part but I wasn't in a very good frame of mind at the time.

She filed a QDRO in 2012 to have 50% my retirement sent directly to her (which I had begun drawing). Since that time the disability plan has been removed from the retirement plan specifically named in my divorce settlement and the QDRO. Since the disability plan is now different, is that QDRO still legally binding? I'm about to file for disability and found out the disability plan shows the QDRO as binding in the new disability plan.

Here is what the new plan says about older QDRO's established in the retirement plan:

"Qualified domestic relations orders received by the Retirement Plan
prior to January 1, 2015 that provide disability benefits to an alternate
payee under the Retirement Plan will be deemed to apply to disability
benefits paid under this Plan on and after January 1, 2015, to the
extent those benefits are now paid out of this Plan"

Here is what my ex wife's QDRO says about disability payments:

"The Alternate Payee (my ex wife) may only receive disability benefits when and if the Player becomes eligible to receive such disability benefits under the Retirement Plan"

I was never qualified or receiving disability under the old Retirement Plan, and therefore the alternate payee was not provided disability benefits. I'm waiting to hear back from my disability plan whether they mean alternate payees who were actually receiving disability benefits apply to benefits paid under the new plan, or if the alternate payee was in my ex's situation where she never received benefits because I was never qualified to receive benefits.

It will hurt if she gets half of my disability. She has remarried and owns two homes and lives in a great neighborhood and I have struggled for years because of my disabilites and would have been homeless if not for friends and family letting me stay with them. I was finally approved for social security disability just over a year ago and am guaranteed approval from my company plan because of that.

If anybody has any thoughts or suggestions I'd appreciate feedback?

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You did the right thing in asking the Plan Administrator how to interpret the language regarding the payment of benefits under the disability plan, and how QDRO's would work.  I have a feeling that this isn't going to be answered in your favor, though, since the probable intent of the QDRO in the first place was that your ex would get half of your retirement and/or disability at such time as you began receiving either.  Your best bet would be to go back to your ex and ask her to agree to a new QDRO in which she gets nothing.  


Good luck.

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Let's ask about this "disability plan".  What is it?  If it's LTD, you should be aware that most LTD plans include an offset for amounts you might be receiving as retirement income (especially if both plans are from the same employer).

I'm a retirement actuary. Nothing about my comments is intended or should be construed as investment, tax, legal or accounting advice. Occasionally, but not all the time, it might be reasonable to interpret my comments as actuarial or consulting advice.

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  • 2 weeks later...

Most QDROs also include a clause stating that successor plans are also bound by the terms of the QDRO.  If that is the case, it is highly likely that your ex is entitled to a portion of your disability benefit.  Your best bet would be to try and get a new QDRO.

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