Withdrawing 401(k) funds with QDRO


#1

I have had a QDRO pre-approved by my ex’s retirement administration and signed by a judge. I sent a certified copy of the order with a request to withdraw the funds to the specified individual early last week and received a call later in the week letting me know that the funds would have to be transferred into a new account under my name before I could withdraw them. If this is the case won’t I be hit with the 10% early withdraw and tax penalties that the QDRO is supposed to protect against or is this just a standard policy?


#2

QDROs are intended to transfer retirement funds into a new retirement account. If you chose to withdraw them prior to retirement age you will be responsible for the penalty.