This office prepares Qualified Domestic Relations Orders (QDROs) on a per order fee basis. The fee is $700.00 for the first order, and $500.00 each for subsequent orders in a case, and includes submitting the QDRO to the court for its entry as an order, and serving the QDRO on the Plan Administrator. Multiple QDROs are required when more than one plan is being divided, such as a savings plan and pension plan. Some plan administrators (such as the federal government) also require a certified copy of the judgment. In such a case, there would be an additional charge of $25.
We work directly with the parties (spouse and ex-spouse), unless we are directed to do otherwise. If, in the course of drafting the QDRO, I have a question that should be addressed or resolved by the parties, I will address that question to both parties, regardless of which party retained me or which party is paying the fee. Additionally, all correspondence from this office concerning the QDRO will be copied to both parties and, usually, to their divorce attorneys.
It is important for the parties to understand at the outset what role I can and cannot play in the process of preparing the QDRO and ultimately having it approved as a court order. I cannot, and am not, undertaking to act as an attorney for either party individually. I do my best to draft a QDRO that is consistent with the court’s judgment, however, I am not the judge, and my interpretation may differ from that of the parties. If there is any question about how the judgment should be interpreted in relation to the QDRO, the parties should consult with their divorce lawyer. While I am happy to explain my interpretation and thinking, either to the parties directly or to their divorce attorneys, I cannot act as an attorney for either party in this matter if, and to the extent that, disagreements arise between them concerning the manner in which the QDRO should be drafted or implemented. Ultimately, if the parties are in disagreement concerning implementation of the QDRO, and cannot resolve that disagreement between themselves, the disagreement will have to be resolved with the assistance of the divorce lawyers or through a decision by the court, and I will proceed with preparation and processing of the QDRO in conformity with whatever resolution is reached.
Here is a brief outline of the process:
1. Once we receive the information and payment, we draft the QDRO and send it to the Plan Administrator to review. We do not have control over how long the Plan Administrator will need to review the documents. We docket the file for follow up in six weeks, and begin calling and writing to the Plan Administrator if we have not received a response by then. Please note that some plans have started charging a fee to review and implement QDROs. Such a fee will be the responsibility of the parties. We will do what we can to minimize that fee.
2. Once the QDRO has been pre-approved, we send it first to the Plan Participant (the person whose Plan is being divided), for review and signing, and then to the Alternate Payee (the person receiving the distribution from the Plan), and then to the divorce attorneys, if required by the court.
3. We will then submit the signed QDRO to court for its entry as an order. Note, the court can enter a QDRO without signatures, after a hearing. The price quoted is based on the expectation that both parties will cooperate in the QDRO process.
4. Once the Order has been signed by the court, we serve a certified copy on the Plan Administrator (the entity in charge of the retirement plan). When the Order is served on the Plan Administrator, this office closes its file, and the parties deal directly with that entity to direct how the benefit is to be paid out. In the rare event a QDRO is not accepted following service on the Plan Administrator, we will make the requested changes for no additional charge.
Generally, the plan to be divided is not precisely identified in the judgment. Therefore, it will be the parties’ responsibility to assure that I am dividing the proper plans. It is also their responsibility to approve of the fraction or formula I use. If they do not understand the formula, or if they have any questions, they must call me to resolve any questions before they sign. I will do my best to answer any questions they may have about the terms contained in the QDRO. However, each party is encouraged to consult with their divorce lawyer if there is any question about how the judgment should be interpreted.
The Plan rules govern how the award can be paid. Not all plans permit an immediate lump-sum distribution. I draft the QDRO broadly, so that the Alternate Payee can choose any payment option the Plan permits.
To prepare the QDROs, we ask the parties to provide the following:
1. Advance payment (from each party, if they are sharing the fee).
2. A copy of the judgment (this provides the caption, date of divorce, date of marriage, and direction on how the plan is to be divided)
3. A copy of the annual statement from the plan (this will provide the exact plan name and the plan administrator address);
4. Each party’s name, address, date of birth, social security number and phone number. Please let us know of any change in address.
If the judgment requires various retirement plans to be averaged out to determine the amount to be conveyed from a single plan, this office should be provided with the dollar amount agreed upon, and the plan from which the distribution should be made should be identified. If the parties wish to have this office make the calculations to equalize the plans, there is an additional charge. They should contact us so that we can discuss the terms for this additional responsibility.
The QDRO process should not be delayed. The death of either party before the final QDRO is approved by the court and served on the retirement plan could mean the loss of the entire benefit. Benefits can also be lost, or severely limited, if the Participant retires before the QDRO is served. The Plan is not obligated to place a freeze on the retirement benefit until it receives a court order. If one of the parties is concerned about this, he/she should ask their divorce lawyer to seek a restraining order against the plan to freeze the assets while the QDRO is being approved.
In order for me to prepare the QDRO I need the parties’ cooperation in providing the materials and information I have outlined above, and can only move as quickly as their cooperation permits. If in the course of preparing, or attempting to prepare, the QDRO it seems to me that non-cooperation or disagreements concerning the terms of the QDRO are creating unreasonable delay, I may suggest to the parties that a court determination concerning required cooperation and/or any disagreements is necessary. Should I do so, it will take the form of a letter which both parties will receive. The mechanism through which a court determination is accomplished is by filing a motion for contempt with the court that heard and decided the divorce. The parties should understand now, and I will reiterate the point if and when I suggest that a court determination be sought, that by suggesting that a contempt motion be filed I am offering no assessment whatsoever that either party is, in fact, in violation of any legal duty arising from the divorce judgment.
This office does not open a file until we receive the requested information and are paid in full. Please feel free to contact this office if you have any questions about this letter.