QDRO Amendment

[renee48]

I am the alternate payee (ex-wife) I have been divorced since 2007. Recently my ex husband and I had QDROs completed, agreed upon and signed by the judge in 5/2017. One the retirements was deferred compensation. Our QDRO was very specific and stated that I was entitled to 50% of the marital portion including gains and losses until the time of distribution. Everything went through smoothly and the money was distributed into a separate account for me. I ended up obtaining 33K in gains. Now the ex husband is upset and stated he didn't realize what he was agreeing to. He is upset about me receiving the gains. He and his attorney recently filed a motion to modify the QDRO to remove the provision of losses and gains, and for me to return the 33K back to the former husband. It is now 9/2017, 4 months later. Do you think a judge would reverse this being that there was no error and all parties originally agreed at the hearing in 5/2017? And what would I need to do in this case.

[MoJo]

That really is a question for your attorney.

I will say, in my experience, the "norm" is that gains and losses are included - but people may agree to whatever terms they wish to.

[Belgarath]

MoJo - just curious - if you had to "guess."  As a non-lawyer, I'd think that in the absence of unusual circumstances, if a valid divorce decree and QDRO have provided for a certain settlement, and one party wants to modify that to their benefit, and to the detriment of the other party, that the judge would be unlikely to grant it. Is that reasonable, or is it a completely unwarranted guess in your experience?

[MoJo]

I would agree, Belgarath.  The rule on "document interpretation" courts are supposed to use, absent something amiss within the four corners of the document, they don't look outside the document to determine intent.  If the language is clear, all the parties agreed at the time, and attorneys were involved, courts ordinarily won't even consider one parties assertion that they misunderstood and didn't intend ... something.

That's the theory, anyway.  In the case the OP has, as I said, the norm would be to credit gains and losses, and most DROs we see provide for that (though not all).

[XTitan]

As the OP referred to "deferred compensation", it makes me wonder what the implications are if this were a nonqualified plan; I usually see a splitting of gains and losses as well.  A DRO can accelerate payment to the AP but not to the service provider; from a 409A perspective, I would imagine that the AP would repay the company and the employee's plan balance adjusted.  Of course, if the company (and NQ record keeper) aren't involved with the revised DRO, how would this ever get reported or audited as a 409A issue?

[hr for me]

Interesting case of my inlaws in Michigan.....ex-step-MIL agreed to a pension QDRO that stated she would get x% of the monthly pension benefit when it commenced - at this point he had already terminated from that company but earned the pension while they were married. However no where in the QDRO did it state when my FIL had to commence and the plan didn't require him to commence on a specific date. She (and I guess her attorney) assumed that he would start at NRA.  If he died before commencing, she got nothing.   

He didn't  so she sued claiming that wasn't what was intended and tried to get the court to force him to commence.    He would rather her get nothing than him get any part of it (insert noises from the peanut gallery) She lost.  I doubt he will ever do anything more than he HAS to legally.

 

[Belgarath]

Maybe he's just being nice, and the actuarial increase by the time he must start RMD payment will give her a higher monthly payment.

Of course, he could jump off the Saginaw bridge, and then she'll get nothing. Wouldn't THAT show her. And I apologize for my strange sense of humor - some people don't get it, and may be offended by such a joke.