San Francisco Retirement & Pension Division Attorney
For many Bay Area couples, retirement savings are among their most valuable assets. This can complicate things when a couple decides to get a divorce. While California law generally considers any contributions made by a spouse to their retirement or pension account during the marriage to be community property, there are also federal laws that may come into play when it comes to dividing such assets. Indeed, how to divide a retirement or pension is often among the more difficult issues to resolve, even in an otherwise amicable divorce.
The best way to deal with this issue is to work with a qualified San Francisco retirement & pension division attorney. Cardwell Steigerwald Young LLP is a California family law firm that specializes in helping clients involved in high net worth divorces with matters related to the division of assets. We can advise you on the law in this area and assist you in obtaining a proper and fair valuation of any retirement or pension accounts as part of your divorce proceedings.
Do You Need a Qualified Domestic Relations Order?
Depending on the type of retirement or pension account you or your spouse have, it may be necessary to obtain a qualified domestic relations order (QDRO) as part of your divorce settlement or judgment. A QDRO is necessary under federal law so that a plan administrator can pay benefits to an “alternate payee,” which in this context usually means the non-employee ex-spouse.
A QDRO Is necessary to divide the following types of retirement and pension accounts:
- 401(k) plans;
- 403(b) plans;
- 457 plans;
- defined benefit or pension plans from a business or corporation;
- employee stock ownership plans;
- profit-sharing plans;
- tax-sheltered annuities; and
- thrift plans.
Other kinds of retirement savings, such as individual retirement accounts (IRAs) or pension plans maintained by a government agency, do not require a QDRO.
It is important to note that an individual spouse’s contribution to a retirement plan is only considered community property if it was made during the marriage. This means that if the spouse contributed to their retirement plan before or after the marriage, this must be accounted for in making a division. California law typically uses a “time rule” formula that divides the years of marriage by the years of contributions to determine the non-employee spouse’s share.
Depending on the facts of a given case, the parties may agree to a “buy-out,” where the employee spouse keeps their entire retirement or pension plan but pays the other spouse for the value of their proportional share. The parties may also agree to “trade” an interest in a pension plan for another community property asset, such as equity in the couple’s home.
Reach Out to Our San Francisco Retirement & Pension Division Attorney
Retirement accounts are among the more complicated types of assets to address in a divorce case. There are often significant tax and legal consequences to such divisions. So it is especially crucial to work with a skilled San Francisco retirement and pension division attorney who can offer expert advice and representation. Call Cardwell Steigerwald Young LLP today at 415-259-5885 to schedule a consultation.
