There is a lot of flexibility, but the easiest method would be for her to transfer $80 K via QDRO to a new IRA in your name. Make sure you use a QDRO, though, or you could end up paying a ton of taxes and penalties (technically, it is possible to do it with a cash distribution, but it's more complicated and you have to have a lot of spare cash lying around to avoid tax penalties, so just use the QDRO).What is the name of your state (only U.S. law)? Georgia
How are uneven 401k plans normally split up in a divorce? My wife has approximately $200k in her plan and I have $40k in mine. All of that was contributed after our marriage of 20 years began.
Thanks for the information as that is helpful. But, my question was not phrased well as it could be taken two ways. What I meant to ask is are these normally split 50/50 in an example like mine, or is there some formula that is used. My wife said a 50/50 is unreasonable as she has had the higher income the whole time, so she thinks she is entitled to a larger share. She mentioned a 70/30 split, which I don't agree with.There is a lot of flexibility, but the easiest method would be for her to transfer $80 K via QDRO to a new IRA in your name. Make sure you use a QDRO, though, or you could end up paying a ton of taxes and penalties (technically, it is possible to do it with a cash distribution, but it's more complicated and you have to have a lot of spare cash lying around to avoid tax penalties, so just use the QDRO).
That, of course, assumes that all of the non-retirement assets are split separately (which is the best way). If your stbx proposes offsetting other assets with the 401K, make sure you consider the tax consequences. $1 in a retirement account is usually worth less than $1 in cash assets (because you still have to pay taxes on most retirement accounts). That's why it's better to divide pre-tax and after-tax assets separately.
You will each be entitled to 50% of marital assets. If all of the money was put into the 401K accounts during your marriage, it's all marital, so you get 50%. If, OTOH, some of it was pre-marital, then only the marital portion is divided.Thanks for the information as that is helpful. But, my question was not phrased well as it could be taken two ways. What I meant to ask is are these normally split 50/50 in an example like mine, or is there some formula that is used. My wife said a 50/50 is unreasonable as she has had the higher income the whole time, so she thinks she is entitled to a larger share. She mentioned a 70/30 split, which I don't agree with.
Thanks! I was considering compromising with her and proposing a 55/45 split, but it sounds like I would be cheating myself by doing that.You will each be entitled to 50% of marital assets. If all of the money was put into the 401K accounts during your marriage, it's all marital, so you get 50%. If, OTOH, some of it was pre-marital, then only the marital portion is divided.
Tell your wife to jump in a lake. It's a martial asset even if she earned more of it than you. My wife didn't work at all during most of our marriage and she still got half. That's just the way the system works.
If all is marital, of course.You each are entitled to 50% of what accrued during the marriage. She would be entitled to 50% of your 401k, and you, 50% of hers.
Combined, there are marital 401k funds totaling $240,000, so you should each have $120,000 when all is completed.
Close. That's 50% of MARITAL assets to each spouse. If some of one or both 401Ks was in place before the marriage, that amount needs to be deducted.Thanks for all the helpful information from everyone. I told my wife what I found and that 50/50 is the way things are normally split up.
He has said at the outset that BOTH 401k's were in started DURING the marriage and BOTH are MARITAL. You got it????Close. That's 50% of MARITAL assets to each spouse. If some of one or both 401Ks was in place before the marriage, that amount needs to be deducted.
Come back and let us know how things work out for you.Thanks for all the helpful information from everyone. I told my wife what I found and that 50/50 is the way things are normally split up. She still thinks it isn't fair and wants me to "think in my heart the best way to split it up".
Counter with, you don't think it's fair in your heart, and, tell her to stop pulling numbers out of her ass. Marital assets are split 50:50 as prescribed by the law that her sisters lobbied to get enacted.
We were considering a collaborative divorce, or a single attorney with a no contest divorce, but now I'm thinking the best bet will be to go to court and let a judge decide.
You need a lawyer. Don't let a jackass judge decide anything for you except alimony!!
I know it will be more expensive, but in some ways I'm not the "bad guy" since I won't decide how things are split. (We have two teenage kids, so I want to try and make it as easy on them as possible, but in this case I think letting a judge decide how to split things are might be the best way.)
Hey Bali, You haven't mentioned that the wife is going to have to give the husband $80 K from her 401K. I thought you said that never happened (well, maybe you never said it, but you sure imply it all the time).Come back and let us know how things work out for you.
It sure as hell wouldn't happen with you as the presiding judge and court clerk LdiJ, without an expensive appeal!!Hey Bali, You haven't mentioned that the wife is going to have to give the husband $80 K from her 401K. I thought you said that never happened (well, maybe you never said it, but you sure imply it all the time).
Bali, you are so full of it. When have I EVER said that marital assets/debts should not be split 50/50?It sure as hell wouldn't happen with you as the presiding judge and court clerk LdiJ, without an expensive appeal!!