Frequently Asked Questions (“FAQ”)
on Retirement Plans & Wills
McGraw Law Offers Answers on Retirement & Wills When Couples Divorce
McGraw Law P.C. provides answers to questions that many clients ask when seeking an attorney. Do you have more questions about divorce retirement plans and wills? Call McGraw Law P.C. today at (540) 904-5704 or message us online.
Q: My Spouse and I are Divorcing. Am I Entitled to Share in My Spouse's Pension?
A: Yes. If your spouse earned the pension in whole or in part during your marriage, you will generally be eligible to share a part of it. A lot depends on the state in which you and your spouse live. Many states do view the pension as belonging to the participant and their spouse. A state court will decide whether an ex-spouse or child is to share in the participant’s pension, and the Employee Retirement Income Security Act, or ERISA, will uphold the court’s decision. A lawyer who practices in the divorce field should be able to assist you in understanding and protecting your rights.
Q: Why Must Some Retirement Plans Divide in a Special Manner?
A: Federal law governs most retirement plans. Most retirement plans receive special tax treatment, allowing contributions to the plan to go in before paying for taxes, and further allowing the income on the money in the plan to accumulate without current tax. The court will give a special order—a Qualified Domestic Relations Order, or QDRO—to the plan’s trustee upon a divorce. The QDRO defines how much of each payment is to go to each spouse.
Q: Do I Get a Part of My Spouse's Stock Options in a Divorce?
A: Yes. If a spouse earned stock options during the marriage, most courts will award at least a part of the options, or the value of the options, to the other spouse in the event of a divorce.
Q: What is the Effect of a Divorce on a Will?
A: It depends on your state’s law. In some states, a divorce decree revokes your entire Will. In other states, it revokes only those provisions that made gifts to the former spouse, not the Will itself. Either way, any property arrangements in a Will or other document—such as a life insurance policy, or bank account—need to be reexamined when you contemplate a divorce. Often, these documents require discussion during a divorce agreement or court decree.
