Thus, the property settlement agreement should award the non-employee spouse Hayden, N. Super , A. An argument can then be made that this fixes the benefit awarded to the non-employee spouse, without the growth that in included in the coverture formula, as shown in the chart on the first page. While Risoldi is a New Jersey case, this hybrid method is applicable in any state that follows the coverture method.
Once a valuation is performed, that valuation can be used for purpose of determining the QDRO percentage, as well as for purpose of immediate offset. Once the percentage is determined, that percentage Use of the dollar value, as discussed above, negates the coverture approach and creates an argument to fixing the benefit.
An example of improperly inserting a dollar value into a marital settlement agreement is the Abel case in New Jersey. In fact, Abel is the perfect storm of misuse of a pension valuation, both in terms of not using the valuation to determine the percentage, and then inserting the dollar value, which negates use of a percentage.
Once a pension valuation is performed, that number can be used to determine the QDRO percentage under coverture, as discussed above, even if an immediate offset is not possible. However, in Abel, the QDRO award was 50 percent of the coverture portion, even though there was a valuation.
Perhaps an offset was not possible, forcing the award to be 50 percent. If the attorney advises that a loan or withdrawal is to be treated as non-marital, we can do so up to the limit of the calculated non-marital balance at the time of the loan or withdrawal. Loan or Withdrawal Taken During the Marriage that is Larger Than the Marital Balance at the Time of the Loan or Withdrawal If the attorney advises that a loan or withdrawal is to be treated as marital but there are not sufficient funds in the marital amount, we can do so up to the limit of the calculated marital balance at the time of the loan or withdrawal with the excess of the amount being taken from the non-marital balance.
Rollovers are treated with the same identification as the prior fund. That is, any funds that were considered marital in the prior account are received as marital and any funds that were non-marital in the prior account are received as non-marital. This may mean that a separate analysis of the prior account is necessary before the receiving account can be fully analyzed. For a large deposit not representing a rollover contribution, the attorney must direct how the funds are to be considered, usually based on the original nature of the funds.
For example, a participant may have a different defined contribution account for each employer, all administered by the same recordkeeper and summarized on one periodic statement. If one of these accounts out performs the plan as a whole, the participant may wish to isolate its growth from the rest of the accounts.
This would require at least two separate tracing calculations depending on the specifics of the accounts and duration of the marriage. This is really not possible. Though we have performed a few analyses attempting to approximate this type of hypothetical calculation, we do not recommend utilizing this approach. There is no established method for performing this calculation, which is why it is so difficult to find an evaluator willing or able to perform it.
It is also unlikely that plan or QDRO administrators will perform such a calculation. They normally limit any calculation or division to before or after consideration of an outstanding loan balance. A tracing calculation where the assumption is that any distribution simply reduces the non-marital portion, as opposed to assuming that they never occurred, can result in a very similar marital portion or award, depending on the circumstances and timing of the analysis.
First Name. Note: For QDRO calculations, use the Process Selection page to restrict a calculation to only relevant functions, typically these: early and late retirement factors, benefit formula, and optional forms of payment.
Alternatively, if your plan rules are set up so that QDRO alternate employees are eligible for the plan, and if the rules prevent all other calculation components from processing QDRO alternate payees, you do not have to make a manual process selection for each calculation. Skip to Main Content. When you do this, use the Process Selection page to limit the calculation, so that you only run the following factors: Early and late retirement factors.
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