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QDRO question


Guest Gibson

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Maybe. A QDRO can assign any portion of a benefit. That can be on the basis of percentage or flat $ amount. However, if you mean can the QDRO assign a flat amount as a lump sum, this may not fly if the plan does not allow a lump sum form of distribution.

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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The Order does not specify the form of distribution. It only provides that Alternate Payee will be able to select from available forms of benefit under the Plan. Plan doesn't permit lump sums.

How does the Plan Administrator, under a separate interest QDRO, administer a QDRO that simply assigns a flat dollar amount? Under the Plan, the Participant's vested accrued benefit is expressed as a monthly benefit payable for life following normal retirement date.

I am simply not as familiar with DB plan QDROs as i am with DC plan QDROs. Please help. Thanks.

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They reject the Order as not qualified because it doesn't comply with the provisions of the Plan.

An Order is not a QUALIFIED Domestic Relations Order until the Plan Administrator says it is. If it doesn't compy with the Plan provisions or if the benefits are unclear, then the Administrator should send it back to the Judge or the Attorney's explaining why it doesn't comply. The Plan does not just have to accept whatever the court sends it.

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I agree with Keith. If the QDRO has been structured as if the plan were a DC plan, then the order is very likely incomplete (at best).

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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I agree with the earlier answers. It is possible in a correctly worded order to provide that an alternate payee would receive a benefit under a DB plan with an actuarial value of a specified dollar amount. The form of benefit to the alternate payee would have that value, but the AP would not be paid that amount if the plan does not offer single sum distributions.

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