What is a Pension Evaluation?

Why might I need a Pension Evaluation?

• The most common reason for a Pension Evaluation is to compare the value of a pension to the value of other marital assets (for example, equity in the marital home, a 401(k), etc.) when dividing assets in a divorce. Another common reason for obtaining a Pension Evaluation is to compare retirement benefit elections, such as, which age to retire or which form of benefit to elect (e.g. survivor annuity, single life annuity or lump sum) since such elections affect the amount and duration of pension benefit payments.

What is the process for obtaining a Pension Evaluation?

• You may contact us or download forms from our website to provide us the information and retainer required to provide you a Pension Evaluation.

How much is my benefit?

• You may request the plan administrator to provide you an estimate of your benefits, along with a copy of a Summary Plan Description which describes in plain language the benefits and rights you have as a plan participant. Alternatively, we can calculate your benefits as part of our Pension Evaluation service.

When will I receive my money?

• When you receive your money from the plan is determined by the plan's benefit payment provisions. As a general rule, plans which have account balances (for example, a 401(k) savings plan, 403(b) tax sheltered annuity and profit sharing plan) will allow an immediate tax-free rollover to the alternate payee's IRA, or pay an immediate taxable lump sum cash distribution to an alternate payee. Furthermore, pension plans don't typically pay monthly benefits to an alternate payee until the participant has satisfied the plan's age and service requirements to be eligible for early retirement. Your eligibility for benefit payments will be described in detail in the Summary Plan Description and the plan administrator's QDRO procedures.

Can I receive a lump sum payment?

• As a general rule, plans which have account balances (for example, a 401(k) savings plans, 403(b) tax sheltered annuity and profit sharing plan) will allow an immediate taxable lump sum cash distribution to an alternate payee. However, very few pension plans pay lump sums since they typically only pay monthly lifetime benefits.

If a retirement plan has a model (i.e. sample) order, should I use it?

• It depends on whether the model order protects both the alternate payee's and participant's interests. Since most model orders don't contain clear, thorough or fair provisions which protect both the alternate payee's and participant's interests, we don't typically use them unless the plan administrator specifically mandates such usage. In this case we still apply our legendary guidance through qualification process and conform the plan shall abide by the parties agreement.

What are your fees?

• Our fees are detailed in our fee schedule provided in this website. If you have any questions about our fees or services, please contact us.

How do I get started?

• You can contact us at info@pension-evaluators.com, or download forms on the forms page from our website to provide us the information we need to get started. An analyst or staff assistant from the office will contact you after you provide the items we need to get started should something be questionable or not supplied with further input.

QDRO Preparation Services

• Qualified Domestic Relations Orders can be applied to pensions of most private employers. If a spouse has a military pension or certain types of government pensions, different types of orders with different types of forms may be required, but in most cases, the result can be the same: with a properly entered order by a court, the pension can be divided between the spouses. In 1974 Congress passed the Employees Retirement Income Security Act (ERISA). This act defined, clarified, standardized and protected employees' rights to pension benefits. It also stated that pension benefits were "non-assignable", thereby shielding these pension benefits from all creditors. Realizing that there was an inequity concerning the marital property rights of spouses and former spouses, in 1984 Congress passed the Retirement Equity Act (REA). This Act defined the rights of spouses, former spouses and dependents, and stated that pension benefits could be assigned pursuant to a "Qualified Domestic Relations Order" (QDRO). As defined under the REA, a "Qualified Domestic Relations Order" (QDRO) means a Domestic Relations Order (DRO) which "creates or recognizes the existence of an alternate payee's right to, or assigns to an alternate payee, the right to receive all or a portion of the benefits payable with respect to a participant under the plan."
  We have prepared over 15,000 Domestic Relations Orders for our clients. It is important to note that we are a full service firm. We prepare the DRO based upon the specifics of the agreement. Upon approval of the requesting attorney that the DRO accurately reflects the terms of the agreement, we then forward the draft to the appropriate pension / retirement plan to obtain pre-approval. This is a very time consuming but important step in the process. It has been our experience that if there is the slightest inconsistency in conforming to the plan's rules, the plan will not pre-qualify the Order. We will not stop working for you until your DRO is Qualified by the plan. Many of our competitors will provide you with the DRO, but will not provide the extra service of having it pre-approved by the plan. If a Court certified Order is rejected by the plan, the whole process must be repeated.

What is a QDRO?

• A "QDRO" is an acronym for Qualified Domestic Relations Order. A QDRO is a court order that requires a retirement plan to pay a portion of the retirement benefits of an employee or retiree (who is called the "participant") directly to the participant's spouse, former spouse, and/or dependent children (who are each called an "alternate payee"). QDROs generally apply to retirement plans provided by corporations and other businesses.

What must a QDRO contain?

• A QDRO must contain the following information: identification of the plan, the participant, and the alternate payee; the amount of the benefits to be paid to the alternate payee; when benefits are to be paid to the alternate payee; and how benefits are to be paid to the alternate payee (for example, a lump sum or monthly benefits).

What are the tax effects of a QDRO?

• Benefits paid directly to any alternate payee by a plan as the result of a QDRO are generally included in the alternate payee's taxable income in the year that the alternate payee receives benefit payments. Also, benefits paid directly to an alternate payee by a plan as the result of a QDRO are not subject to the 10% early withdrawal penalty which is generally applicable to withdrawals from retirement accounts prior to age 59-1/2.

Do I need an order to Split an IRA?

• Yes, per IRC 408 (d) 6 an "IRA SPLIT ORDER" is required indicative to a marital dissolution action. An IRA SPLIT ORDER is a court order that requires a retirement plan to pay a portion of the retirement benefits of an employee or retiree (who is called the "participant") directly to the participant's spouse, former spouse, and/or dependent children (who are each called an "alternate payee"). In other words, IRA SPLIT ORDERs are almost identical to QDROs as described above, except they are found under a different section of the code and have a different set of approval phases and processes.

What is a DRO?

• A "DRO" is an acronym for Domestic Relations Order. A DRO is a court order that requires a retirement plan or plan participant to pay a portion of the retirement benefits of an employee or retiree (who is called the "participant") to the participant's spouse, former spouse, and/or dependent children (who are each called an "alternate payee"). In other words, DROs are similar to QDROs and EDROs as described above, except DROs apply to non-qualified deferred compensation plans (for example, stock options) and retirement plans which are only provided to executives of corporations. Also, the tax effects of a QDRO (as described above) do not usually apply to DROs.

Why might I need a QDRO, or DRO?

• The most common reason for needing a QDRO or DRO is that the parties in a divorce do not have sufficient assets (e.g. cash, retirement accounts, home equity) to permit the plan participant to keep his/her entire plan benefit in exchange for the non-participant spouse being awarded another asset. A second common reason is that the parties may not agree on the present value of the pension to be offset against other assets (see "What is a Pension Evaluation" above). A third common reason is to provide spousal support and/or child support payments from a retirement plan to an alternate payee (spouse, former spouse and/or dependent of the participant) by monthly pension payments or a lump sum payment from a retirement account. A fourth common reason is to pay off marital debt with retirement accounts at the time of divorce or legal separation.

What is the process for obtaining a QDRO,or DRO?

• You may contact us or download forms from our website to provide us the information and retainer required to provide you a QDRO, or DRO. After we draft the appropriate order, we send it to you and/or your attorney(s) as we are instructed. The attorney(s) should then review the order for legal content, obtain the required signatures and enter it with the court. After the order is entered with the court, the attorney or attorney's client must send it to the plan administrator for qualification and implementation by the plan administrator. If you have not received a written response from the plan administrator within a reasonable time (usually 4 to 6 weeks) regarding the qualification of the order, you should contact the plan administrator for the status of the plan administrator's review of the order.
  Usually, we complete a proposed order within 1 to 2 weeks of receiving all information from the parties which we need to draft an order. After we have drafted an order it will usually take the parties 1 to 2 weeks to review the order, obtain signatures, and enter it with the court. Finally, the order must be reviewed by the plan administrator which usually takes 4 to 6 weeks. Based on the above time frames, the entire process usually takes 6 to 10 weeks.

What should I do if my ex-spouse will not sign a QDRO or DRO?

• Contact your attorney for possible legal remedies.

What happens if a QDRO is rejected by a plan administrator?

• Since we guarantee that we will provide you an order which will be qualified under the plan administrator's procedures, we will make any required changes to obtain the plan administrator's approval of an order. After we receive a copy of a plan administrator's rejection notice, we will promptly review the reasons for rejection and provide a revised order which satisfies the plan administrator's requirements as stated in the rejection notice. If a plan administrator rejects an order due to its form, we will make the necessary revisions at no additional charge.

How long does the QDRO process take?

• Pension Evaluators & Qdros Of Troyan, Inc Associates Group, can help matrimonial practitioners avoid many of the pitfalls associated with distributing retirement assets. Pension Evaluators & Qdros Of Troyan, Inc Associates Group, is the name to be known when it comes to assisting attorneys in calculating the marital / community value of pension and retirement benefits, offsetting assets and dealing with retirement plans, and drafting domestic relations orders. We have extensive knowledge of retirement plan rules and requirements.
  Our Settlement Agreement Consultation service will assist attorneys throughout the whole process, that may include, but not be limited to, the determination of the value of the retirement assets, offsetting the assets if necessary, preparing the appropriate and complete language for the Agreement and preparing the appropriate QDRO(s) and obtaining pre-approval from the retirement plan(s). The fee for this service will depend upon the complexity of the case.