Property division can be one of the most contentious portions of your divorce. Even after just a few years of marriage, you and your spouse have probably commingled some of your separate property and acquired quite a bit of marital property. In Illinois, marital property is defined as any assets or debts that you or your spouse acquired during the marriage. All marital property must be divided before you can finalize your divorce -- including your retirement accounts. These can have both marital and non-marital characteristics, which is why they can be so difficult to deal with. Certain types of retirement accounts require certain procedures in order to divide them in accordance with the law. A knowledgeable asset division attorney can help you determine what kind of steps you must take to divide this valuable marital property.
Is Your Retirement Account Marital or Nonmarital Property?
As a general rule of thumb, any retirement accounts that either spouse acquired or participated in during their marriage are presumed to be marital property. These may include pension benefits, defined contribution plans and accounts, individual retirement accounts, and non-qualified plans. If you believe that your retirement account or pension should not be considered marital property, you must prove to the court that your retirement benefits were acquired through a method that would deem them to be nonmarital property, such as through gift or legacy. In addition, your retirement benefits could be specifically excluded from the marital estate through a valid prenuptial or postnuptial agreement.
Using a QDRO to Divide Retirement Accounts
The most common way to divide retirement benefits is by using a qualified domestic relations order, or QDRO. This legal document that acts as a set of instructions to use when it comes time to disburse retirement benefits. A QDRO can be used on any qualified plan, such as a 403(b) or a 401(k). This document will allow you to add another payee to your retirement account, which can be a current spouse, former spouse, child, or other dependent. The QDRO will include information about both payees, the percentage going to each payee, how that percentage was determined, the number of payments to be made, and how those payments will be made. A QDRO also allows funds to be transferred from a retirement account without incurring taxes or penalties for early withdrawal.
A Will County Retirement Account Division Attorney Can Help You Split Your Funds
Most of the assets in your divorce will be relatively simple to divide -- either you or your spouse will gain possession of the asset when all is said and done. However, when it comes to retirement accounts, things are often not so simple. There are various legal processes and documents that are involved in making sure each spouse receives his or her fair share of these assets. At Wakenight & Associates, P.C., we have the experience needed to help you split all of your marital property -- including your retirement accounts. Call our skilled Orland Park, IL marital property division lawyers today at 815-458-5660 to arrange a free consultation.