For many couples, the most significant portion of the marital assets is their retirement plans. Under community property laws in Arizona, the part of the retirement benefits earned during the marriage is subject to division upon divorce. When retirement plans are sponsored by a private company they are divided by a special Order called a Qualified Domestic Relations Order (QDRO). If it is a Federal or State sponsored plan, a QDRO is not utilized but special orders do need to be drafted to complete the division.
The types of plans subject to these orders are 401(k) plans, 403(b) plans, IRAs, annuities, 457 deferred compensation plans, profit sharing plans, ESOP plans, military retirement plans, and federal government plans (CSRS and FERS). In Arizona, the two most common state plans are the Arizona State Retirement System and Arizona Public Safety Personnel Retirement System.
The drafting of the special orders and QDROs are very complex and are not usually handled by the same lawyer who handles your divorce. There are complexities involved such as dealing with survivor benefit plans, pre-retirement death benefits, vested and non-vested benefits, and loans that may have been taken out before or after a divorce. It is important that you consult with an experienced family law attorney who can advise you of your rights with respect to your interest in the retirement plans.
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