When you work all your life for your retirement, you don’t want to lose half of it in a divorce. You also probably don’t want to have the rest of your benefits swallowed up by attorney fees. At Cravens & Noll, we work hard to protect our clients’ interests in their divorce cases while keeping our costs as reasonable as possible. Our diverse team of divorce lawyers has a wealth of experience handling issues like dividing 401K and other retirement accounts.
Virginia law treats 401(k) plans a lot like any other type of property:
- Marital property: The money that has gone into the retirement account during the time of the marriage is considered marital property.
- Exempt property: The money that has gone into the account before the marriage and after the separation is considered separate property.
In Virginia, the circuit court, by statute, can award up to 50 percent of a retirement plan that is determined to be a marital asset. A Qualified Domestic Relations Order (QDRO) directs the pension administrator as to how the benefits are to be divided between the spouses based on the court’s determination. The receiving spouse can then roll over his or her share into a qualified IRA, thus avoiding taxes and penalties.
The difficulty comes when determining how much of the interest and other benefits earned are to be divided. We work regularly with a team of experts, including forensic accountants, with a wealth of experience dealing with complex division of marital property issues.