When couples in Ohio divorce, there is a variety of benefits that can be included during the property division stage of the dissolution of the marriage. One of these involves retirement benefits paid out under a Qualified Domestic Relations Order (QDRO), which establishes which portions of a person’s retirement benefits can be paid to his or her spouse, ex-spouse, child or another dependent.
A QDRO can be used to have child support, alimony or a portion of the marital property taken from the payer’s retirement plan. For a QDRO to be valid, specific information must be included, such as the mailing addresses of the retirement plan’s participant and the other people who will also be receiving part of the payment as well as what percentage of the payment each person will receive.
Concerning the division of property for a spouse or ex-spouse, a QDRO establishes that he or she can receive payment from the plan similar to the plan’s participant and must report those payments the same way. If a child or dependent who is not a spouse or ex-spouse is receiving the payment, the retirement plan’s participant will be taxed for the payment. Another benefit offered by a QDRO for spouses and ex-spouses is that the partial or full amount received in payment can be rolled-over free of tax into another qualified retirement plan.
Understanding how benefits included in property division during a divorce work is important in ensuring that a fair divorce settlement is negotiated between the ex-spouses. Seeking guidance from a family law lawyer might help Ohio residents understand the legal and tax implications of the division of property. An attorney might help his or her client gather the necessary documents, create a divorce strategy, negotiate with the person’s ex-spouse and represent him or her in court during appearances.