What does QDRO Mean?
A QDRO is short for “qualified domestic relation order“. They are court order judgements to help pay for child support, alimony, and any other entitlement a spouse or former spouse may have. In short, if you are granted a QDRO you are entitled to all or a portion of someone’s retirement plan. This could include a 401(k) or IRA.
Why is a QDRO Necessary?
Typically QDROs are seen more often with divorces in an effort to split assets evenly. While not always the case, divorces tend to end with assets being split down the middle. This could include your home, bank accounts, and cars.
A QDRO can help facilitate the split of retirement investment assets.
QDRO to IRA
In most cases you do have the options to move the assets from a QDRO into an IRA, or individual retirement account. This can be beneficial for you as you can have more control over the money and investments inside of the account.
IntelliVest Wealth Management helps clients with investing the money from a QDRO to an IRA. Our financial advisor will sit down with you to learn more about your goals and how you need the investments to work for you.
If you want to learn more and get in touch with us about your QDRO, please call us at (864) 598-0000 or contact us here.
Are QDRO Distributions Taxable?
Yes, QDRO distributions are taxable to the recipient. Please reach out to your CPA with regards to how a QDRO distribution would impact your tax obligations.
Can a QDRO be Done After Divorce?
A QDRO can be done after a divorce settlement. However, you may want to consider issuing the QDRO with the initial divorce agreement. We recommend that you consult your attorney on what is best for you and your situation.
QDRO Without Divorce
According to American Planning of Estate Planning Attorneys, a QDRO without divorce is theoretically possible. Currently, there is no statement from ERISA that limits a QDRO to just a Divorce.
With this being said, it is not very common to do so outside of a divorce settlement.
5 Financial Steps to Take After Divorce
>>Click here for 5 Financial Steps to Take After Divorce.
Disclosures:
IntelliVest Wealth Management is a Registered Investment Advisor Headquartered in South Carolina. This is not financial advice and should be reviewed for educational purposes only. If you have questions about your own financial goals please reach out to us or your financial professional.
