Have separation agreement, 1 year out of marital home, next?


#1

Hi there,

Thanks for providing this invaluable resource. My husband and I separated amicably a year ago-- we together shared 1 lawyer to draft up a separation agreement and signed it in Jan 2009. It is now time to follow through with the divorce. He has refinanced the home into his name, and we no longer share any debt. The only joint property is the split of his 401K. We agreed in the agreement to split it 70/30 in my favor-- I will take a cash distribution of a portion of it, and we each remain commited to this.

What are the next steps? If there is any way possible, we would like avoid spending more money on lawyers as we are in total agreement. I cannot get a clear feel of what we do next, but can roughly guess at the following:

  1. Deal with the QDRO - he has to give me a QDRO from his plan that details the amt to split; i take this and file a coversheet, civil summons, and complaint for division of retirement benefits with the clerk in my county

  2. submit claim for absolute divorce that has a claim for equitable distribution that recognizes the QDRO? is the QDRO included here? Or is it all about having all your paperwork together for a divorce date with a court?

What is the inherent timing in this? I will want to take out about 2/3 of the 401K into cash and the remaining into an IRA-- I have to only pay income tax, yes? When does this distribution happen-- on hold until after the actual divorce?

What happens if none of these things get done before the end of the year and we are still married? We very much each want to file single next year.

Thanks for responding to my salvo of questions.


#2

Yes, you will need to prepare a QDRO which directs the plan to distribute the funds pursuant to your agreement. The plan often can provide sample QDROs that you can use as a go by. I would recommend you have an attorney review the Order once drafted to ensure there are no issues with it.

The QDRO can be entered in the same action as the divorce. Not only does this streamline the process, there will only be one filing fee at the court house.

To do this you need to include a claim for Equitable Distribution of retirement benefits in your divorce Complaint, then submit the QDRO for the judges signature.

Once you have the QDRO entered the timing of the distribution depends on the Plan. You will need to send a certified true copy of the same to the Plan to allow them to distribute the funds.

Typically the divorce process from start to finish takes about 60-90 days.


#3

Great, this clarifies a lot.

I will submit all 3 in one filing, and the QDRO is our immediate next step.

I know you are not a tax advisor, but typically, if I am divorced by 12/31/2010-- can i file taxes as single for 2010?

He earns substantially more than me and we see quite a marriage penalty in taxes. Im concerned then that any cash distribution I take from the 401k would be taxed at our high marital rate as opposed to my lower single rate.

Oh, and when you say ‘certified true copy of the same’… what is that referring to?

Thanks. This is a great resource.


#4

You may file as single if you are divorced and have lived apart for 6 months of the tax year.

A certified true copy is a copy of the document which the clerk will verify as a true copy, he or she will stamp and seal the same to prove to the plan the copy is authentic. I believe there is a $3.00 charge for the copy.


#5

Hi Erin,

Thanks again for all your advice. This is an enormous public service, and Im very grateful something like this exists.

Just an update-- I have a QDRO being prepared this moment. My ex and I have been separated (no kids) for 1 year and have no property to divide except his 401k, and I don’t need alimony.

If I understand everything correctly, for the next steps I can follow your how-to-get-divorced instructions
http://www.rosen.com/2008/11/04/how-to-get-a-divorce-without-a-lawyer/

but include the QDRO and the claim for equitable distribution form (that address the QDRO) with the court filing.

This is in Wake County.


#6

That is exactly right.


#7

I have the complaint (and copies), notarized verification (and copies), and the civil summons (and copies).

To serve papers by certified mail in Wake county— do I send all 3 of the above? Send my ex the original or copies?

Thanks


#8

Send one original of each document via certified mail.


#9

thanks so much Erin;

this msgboard is such a service-- very grateful


#10

You are very welcome!