Getting Your Share of Pension and Retirement Benefits In Your Divorce Settlement
If you are an older adult or ending a long-term marriage, pension benefits and retirement accounts could represent significant assets in your divorce case. You may have planned to spend your later years together with your spouse, and without this form of income you could be facing serious financial insecurity. During marital property division negotiations, it is important that these types of assets are fully disclosed to ensure you get your fair share as part of your divorce settlement.
Pension and Retirement Benefits In Divorce
Under the Florida Statutes, any property or assets earned, acquired, or otherwise accumulated during your marriage are subject to the rules of equitable division. This means that the judge will consider multiple factors in your case in determining how to distribute property on a fair, but not necessarily even basis. These factors include:
- The length of your marriage;
- Each spouse’s age and overall health;
- Your income and earning potential;
- Any non-marital assets you possess;
- Any career or educational sacrifices made by either you or your spouse in support of the other.
Along with dividing real estate and personal property such as furniture, cars, and collectibles, any financial accounts you or your spouse own will need to be divided as well. This includes pension benefits from employers and funds in IRAs, 401ks, and other types of retirement accounts.
Dividing Retirement Benefits
Dividing retirement benefits in a divorce can be a rather complicated process. It requires a Qualified Domestic Relations Order (QDRO) from the judge to provide to the benefit plan administrator once your divorce becomes final. This will need to specify the amount of the plan benefits you are entitled to, and when and how they will be paid. The Internal Revenue Service warns that you need to give careful consideration to the tax implications when dividing these types of benefits. Taking your share of these benefits in one lump sum prior to reaching retirement age could result in heavy penalties. Options to consider include the following:
- Rolling over your share of these funds into your own individual retirement account;
- Waiting until you reach retirement age to take periodic payments;
- Taking a lump sum payment at a later date, once your spouse reaches retirement age.
If your marriage lasted longer than 10 years, you may also be entitled to claim Social Security benefits through your spouse. These may be available once you reach the age of 62, regardless of how long you have been divorced or whether your spouse has remarried.
Reach Out to Us Today for Help
Going through a divorce is draining, and dividing the property and assets you and your spouse accumulated during your marriage can get complicated. Fortunately, our Fort Lauderdale divorce attorney is here to provide the caring, professional legal representation you need. Reach out and call or contact attorney Vanessa L. Prieto online today and request a consultation to discuss your case and how we can help you.