What Is The QDRO Division of Asset Date In A Divorce?

[Iraintero]

What is the name of your state (only U.S. law)? California.

I'm in a divorce. What should be the division date of our retirement account via QDRO.

On 4/18/12, the judge granted me spousal support but not the legal separation I sought, saying that the details of how our community property should be divided were incomplete.

He did at that time, however, freeze our retirement account, saying that neither of us could touch it, that we couldn't withdraw from it or contribute to it until the details of how it was to be divided were stipulated, though the account would still continue to be in existence and increase/decrease in value according to the day-to-day occurrences of the investment market until it is divided between us 50/50.

Subsequently we amended the legal separation to a divorce with stipulated details, accepted by the judge on 6/3/14, which is the date of our divorce.

The QDRO division process of community property assets has now begun.

I recently received the first draft from the QDRO attorney, stipulating the division date of this frozen retirement account to be the separation date, not its most current valuation.

Our divorce papers filed with the court stipulated no specific division date, only that the account was to be divided 50/50.

To me, the division date of the date of separation is wrong. It should be the date of most current valuation, valuations for this account being calendar quarterly.

It's a community property 50/50 asset, like our house, which was appraised recently and he bought me out at the CURRENT value of the house, not its value back on 4/18/12, the date of separation.

This retirement account is the same, and should be appraised at the most CURRENT value date. Right?

I wasn't allowed by the judge back on the date of separation to withdraw my share of the account. My share of the account stayed in the account, subject to risk of loss or gain, as was my spouse's share.

Now that we're divorced and allowed to divide the account, shouldn't it be divided up according to its most current value?

 

[LdiJ]

What is the name of your state (only U.S. law)? California.

I'm in a divorce. What should be the division date of our retirement account via QDRO.

On 4/18/12, the judge granted me spousal support but not the legal separation I sought, saying that the details of how our community property should be divided were incomplete.

He did at that time, however, freeze our retirement account, saying that neither of us could touch it, that we couldn't withdraw from it or contribute to it until the details of how it was to be divided were stipulated, though the account would still continue to be in existence and increase/decrease in value according to the day-to-day occurrences of the investment market until it is divided between us 50/50.

Subsequently we amended the legal separation to a divorce with stipulated details, accepted by the judge on 6/3/14, which is the date of our divorce.

The QDRO division process of community property assets has now begun.

I recently received the first draft from the QDRO attorney, stipulating the division date of this frozen retirement account to be the separation date, not its most current valuation.

Our divorce papers filed with the court stipulated no specific division date, only that the account was to be divided 50/50.

To me, the division date of the date of separation is wrong. It should be the date of most current valuation, valuations for this account being calendar quarterly.

It's a community property 50/50 asset, like our house, which was appraised recently and he bought me out at the CURRENT value of the house, not its value back on 4/18/12, the date of separation.

This retirement account is the same, and should be appraised at the most CURRENT value date. Right?

I wasn't allowed by the judge back on the date of separation to withdraw my share of the account. My share of the account stayed in the account, subject to risk of loss or gain, as was my spouse's share.

Now that we're divorced and allowed to divide the account, shouldn't it be divided up according to its most current value?

Based on the fact that the judge froze the account, so the only assets in the account were community assets, I would agree with you. If your ex had still been making contributions to the account I would have agreed that your separation date should be used.

 

[Bali Hai]

What is the name of your state (only U.S. law)? California.

I'm in a divorce. What should be the division date of our retirement account via QDRO.

On 4/18/12, the judge granted me spousal support but not the legal separation I sought, saying that the details of how our community property should be divided were incomplete.

He did at that time, however, freeze our retirement account, saying that neither of us could touch it, that we couldn't withdraw from it or contribute to it until the details of how it was to be divided were stipulated, though the account would still continue to be in existence and increase/decrease in value according to the day-to-day occurrences of the investment market until it is divided between us 50/50.
Subsequently we amended the legal separation to a divorce with stipulated details, accepted by the judge on 6/3/14, which is the date of our divorce.

The QDRO division process of community property assets has now begun.

I recently received the first draft from the QDRO attorney, stipulating the division date of this frozen retirement account to be the separation date, not its most current valuation.

Our divorce papers filed with the court stipulated no specific division date, only that the account was to be divided 50/50.

To me, the division date of the date of separation is wrong. It should be the date of most current valuation, valuations for this account being calendar quarterly.

It's a community property 50/50 asset, like our house, which was appraised recently and he bought me out at the CURRENT value of the house, not its value back on 4/18/12, the date of separation.

This retirement account is the same, and should be appraised at the most CURRENT value date. Right?

I wasn't allowed by the judge back on the date of separation to withdraw my share of the account. My share of the account stayed in the account, subject to risk of loss or gain, as was my spouse's share.

Now that we're divorced and allowed to divide the account, shouldn't it be divided up according to its most current value?

If the shares are divided 50:50 as they should be and not the dollar amount, it doesn't matter what date is used.

 

[Iraintero]

Based on the fact that the judge froze the account, so the only assets in the account were community assets, I would agree with you. If your ex had still been making contributions to the account I would have agreed that your separation date should be used.

Thank you for your response.

Yes, to your first sentence, that indeed is the key, that, as required by QDRO that there must be a "division date" stipulated, that the date should be the current valuation date. Makes total senses.

But even if my ex had been allowed to continue to make contributions (which, yes, he wasn't allowed to do), if the separation date was used as the division date, I would still need to have my distribution adjusted by the current value of the account, as my half of that community property asset, that by legal rights belonged to me, was then being used by my ex without my consent to increase the value of the account substantially. So if the account is greater in value, a formula calculated additional amount over the value of the account should accrue to me, and had it lost, just as if our house had dropped in value between separation and current valuation, I would have to endure a loss, as would he. That would be fair.

 

[Iraintero]

If the shares are divided 50:50 as they should be and not the dollar amount, it doesn't matter what date is used.

Thank you for your response.

Yes, but sadly the government is involved as the retirement account when he was working was funded by a paycheck reduction from his government pay.

He retired prior to our separation, so contributions stopped.

The account is indeed community property, and since we started that account after our date of marriage, it's clear that division should be 50/50 -- we're financial partners throughout until it's divided.

But QDRO law stipulates that a division date must be specified.

Using the separation date in this case is pure lunacy.

But QDRO law requires a date.

It would be great if we could just go to the fund management company and say please divide this 50/50 and write us each a check for our amount and we go on our way, like we could if this were a passbook account or something.

But the government is involved, so that makes it more regimented and difficult.

 

[Bali Hai]

Thank you for your response.

Yes, to your first sentence, that indeed is the key, that, as required by QDRO that there must be a "division date" stipulated, that the date should be the current valuation date. Makes total senses.

But even if my ex had been allowed to continue to make contributions (which, yes, he wasn't allowed to do), if the separation date was used as the division date, I would still need to have my distribution adjusted by the current value of the account, as my half of that community property asset, that by legal rights belonged to me, was then being used by my ex without my consent to increase the value of the account substantially. So if the account is greater in value, a formula calculated additional amount over the value of the account should accrue to me, and had it lost, just as if our house had dropped in value between separation and current valuation, I would have to endure a loss, as would he. That would be fair.

First of all, the judge was stupid for not allowing your ex to continue contributing to the retirement account. The contributions and gain/loss on those funds would have been simple to mathmatically eliminate from the division.

What is the exact wording of your QDRO?

 

[Zigner]

First of all, the judge was stupid for not allowing your ex to continue contributing to the retirement account.

Contributions had already stopped Bali.

He retired prior to our separation, so contributions stopped.

 

[Bali Hai]

Contributions had already stopped Bali.

That's not the point, the intent of the order was to prevent any further contributions.

 

[Silverplum]

But the government is involved, so that makes it more regimented and difficult.

"The government" contributed up to HALF of that account: don't be surprised that nothing in life is free.

 

[Iraintero]

First of all, the judge was stupid for not allowing your ex to continue contributing to the retirement account. The contributions and gain/loss on those funds would have been simple to mathmatically eliminate from the division.

What is the exact wording of your QDRO?

The judge froze us both from depositing or withdrawing ourselves, understandably to prevent complications that could arise if my ex decided to gut the account. I don't have a problem with what the judge did, and neither does my ex.

As to the wording of the QDRO, there are two entities involved: 1) the government monthly retirement amount, which is indeed subject to date of separation, and 2) this stock portfolio retirement account in which my ex and I are financial partners, which is managed by a private firm but authorized through his former employer (the government, from which he is now retired and he retired prior to our separation).

In the QDRO, the two are described separately. The stock portfolio is not at all described as being linked to the date of separation.

But the QDRO attorney chose to value the stock portfolio retirement account at its quarterly valuation two years ago, which happens to be close to the date of separation. That's the mistake. This stock portfolio retirement account is to be treated separately valuation-wise from the government monthly retirement amount that is based solely on length of service.

The stock portfolio retirement account is property, and thus it should be divided like property, based on current market value.

 

[Bali Hai]

The judge froze us both from depositing or withdrawing ourselves, understandably to prevent complications that could arise if my ex decided to gut the account. I don't have a problem with what the judge did, and neither does my ex.

I understand why the judge did that, however, denying someone the ability to build their retirement for two years or more during a protracted divorce because the judge doesn't want to deal with complications would be totally unacceptable to most people.

As to the wording of the QDRO, there are two entities involved: 1) the government monthly retirement amount, which is indeed subject to date of separation, and 2) this stock portfolio retirement account in which my ex and I are financial partners, which is managed by a private firm but authorized through his former employer (the government, from which he is now retired and he retired prior to our separation).

In the QDRO, the two are described separately. The stock portfolio is not at all described as being linked to the date of separation.

But the QDRO attorney chose to value the stock portfolio retirement account at its quarterly valuation two years ago, which happens to be close to the date of separation. That's the mistake. This stock portfolio retirement account is to be treated separately valuation-wise from the government monthly retirement amount that is based solely on length of service.

The stock portfolio retirement account is property, and thus it should be divided like property, based on current market value.

What does your divorce decree say about the stock portfolio? The QDRO attorney represents your ex I presume?

 

[Iraintero]

What does your divorce decree say about the stock portfolio? The QDRO attorney represents your ex I presume?

I've since been in contact with the QDRO attorney, and it appears that the stock portfolio's initial figure is derived from the account statement nearest the date of separation.

But, it stipulates that I am indeed to receive the current market value based on what amounts to 50/50 at the time of distribution.

It's all just worded so .. legalezely.

The problem now appears to be that if my ex has done something to the account, taken out a loan or whatever, that by not basing the calculation on the most current percentage, the math might cost me .. but it's hard to tell.

Bottom line, though the QDRO attorney made some statements in the papers sent to me that contradict what he told me today, the actual legal document that is to be filed shows that I will get as close to current market value as possible at the time the account is divided.

I wish he wouldn't have been so careless in his memos, as they made it appear contrary to what it appears the actual legal documents he created say.

I'm having another attorney review it to be sure.

The QDRO attorney was not my ex's attorney, but was an attorney agreed upon by our two main attorneys.

 

[Bali Hai]

I've since been in contact with the QDRO attorney, and it appears that the stock portfolio's initial figure is derived from the account statement nearest the date of separation.

But, it stipulates that I am indeed to receive the current market value based on what amounts to 50/50 at the time of distribution.

It's all just worded so .. legalezely.

The problem now appears to be that if my ex has done something to the account, taken out a loan or whatever, that by not basing the calculation on the most current percentage, the math might cost me .. but it's hard to tell.

Bottom line, though the QDRO attorney made some statements in the papers sent to me that contradict what he told me today, the actual legal document that is to be filed shows that I will get as close to current market value as possible at the time the account is divided.

I wish he wouldn't have been so careless in his memos, as they made it appear contrary to what it appears the actual legal documents he created say.

I'm having another attorney review it to be sure.

The QDRO attorney was not my ex's attorney, but was an attorney agreed upon by our two main attorneys.

Smart thinking having another attorney review the documents. Sounds like you are receiving what you are entitled afterall. Good for you.