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QDRO for Health Reimbursement Account


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But for a group health plan, consider whether the plan recognizes a qualified medical child support order and, if so, what rights a QMCSO might provide.

 

Peter Gulia PC

Fiduciary Guidance Counsel

Philadelphia, Pennsylvania

215-732-1552

Peter@FiduciaryGuidanceCounsel.com

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3 hours ago, leevena said:

Little confused also.  A QDRO is used to divide assets when a couple are divorcing.  An HRA is an employer account funded with employer money, and therefore not an asset of the employee.  Am I missing something.

This particular plan does allow for these accounts to be divided (weird, I know), and I found a few others online that do as well.  It's for the benefit of the former spouse and not the child, so a QMCSO would not be appropriate.

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Internal Revenue Code § 105(b) provides an exclusion from gross income regarding medical care of the employee, the employee’s spouse, the employee’s dependent, or the employee’s child.

 

If a health-reimbursement plan provides a benefit to someone who is no longer the employee’s spouse, the employer might want its lawyer’s advice about the extent to which the benefit is excluded from, or included in, gross income for Federal income tax and other purposes.

Peter Gulia PC

Fiduciary Guidance Counsel

Philadelphia, Pennsylvania

215-732-1552

Peter@FiduciaryGuidanceCounsel.com

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Thank you everyone!  I think I finally have it figured out.  After the HRA participant becomes vested, the plan releases the funds to them via a VEBA and it is at that point that the funds become property of the participant and can be divided as equitable distribution pursuant to a divorce.

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23 hours ago, QDROPrep said:

Thank you everyone!  I think I finally have it figured out.  After the HRA participant becomes vested, the plan releases the funds to them via a VEBA and it is at that point that the funds become property of the participant and can be divided as equitable distribution pursuant to a divorce.

Makes sense now.

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