How do you go about dividing retirement benefits in divorce? First, the domestic relations court must determine who is entitled to what portion of retirement benefits. Retirement benefits accumulated during the marriage are marital assets, and must be divided as part of an equitable division of property. Equitable division means a fair division of property.
Courts consider a number of different retirement plans:
- Federal public retirement plans, including: Civil Service Retirement System, Federal Employees Retirement System, Federal Thrift Savings Plan, Railroad Retirement Benefits, Military Benefits, and Social Security.
- Ohio State Retirement Plans, including: State Teachers Retirement System, Public Employees Retirement System, Police and Firemen Retirement System, and Deferred Compensation Plans.
- Private plans provided by an employer, including: 401(k) plans and defined benefit plans. A defined benefit plan is a pension plan.
- Plans created by individuals, including: IRAs, Roth IRAs, Self-Employed Retirement Plan.
Plans such as 401(k)s and IRAs can be valued by looking at the current statements. Pension plans are valued by determining the present value, usually by using an expert. Contributions prior to the marriage and any appreciation from such premarital contributions constitute separate property and are not subject to division. Again, an expert is usually used to determine what portion of the retirement plan is separate property. Social security benefits must be considered when dividing public plans. This is important because a spouse who earns and contributes to a public retirement plan does not contribute to or earn social security benefits during that time.
How are retirement plans divided? Usually, a Qualified Domestic Relations Order (QDRO) is used to divide a retirement plan. Ohio State retirement plans are divided with Ohio’s Division of Property Order forms (DOPO). Failure to use such forms can result in negative tax consequences.
To read more, click on the following links to my other articles on property division, divorce and dissolution: personal property and real estate division for unmarried couples in Ohio, personal property and real estate division in Ohio divorces, evaluating and dividing a business in an Ohio divorce, does the IRS define Ohio spousal support as alimony, when does alimony end in Ohio, when does child support end in Ohio, Ohio alimony factors, Ohio child support terms, everything you wanted to know about Ohio child support, Ohio divorce and dissolution may or may not be a choice, and divorce and taxes in Ohio.
Attorney Gigiano is a Wadsworth Divorce Attorney in Medina County, who regularly litigates the division of retirement benefits in Medina County Domestic Relations Court, Summit County Domestic Relations Court and Wayne County Domestic Relations Court. If you have questions about this or other questions you need answered by an experienced Wooster family law lawyer near Rittman or an Akron divorce lawyer near Barberton, please call Attorney Daniel F. Gigiano at 330-336-3330.