Select a plan type to learn how it works and how it is divided in divorce
This library explains how each type of retirement plan works, what decisions need to be made when dividing it in divorce, and what orders our office prepares. Click any plan to expand the explanation and access the audio explainers. Click it again to collapse it.
When you are ready to engage us to prepare an order, you can do so in one of two ways:
(i) You may refer your client directly to us, and we will work directly with your client to complete our online intake questionnaire, and your client will pay our flat fee for each Order — simply complete the QDRO Initial Intake Form at qdroaz.com/Quentin/referral.html; or
(ii) You may complete our online intake questionnaire yourself to provide us all the information we need and to pay our flat fees through your office, using the green link at the bottom of each plan section below.
If you have any questions, call us at (520) 577-5155.
The TSP is the federal government's 401(k)-style retirement savings plan for civilian and uniformed federal employees, administered by the Federal Retirement Thrift Investment Board (FRTIB). It is not an ERISA plan and does not require a QDRO. The order is called a Retirement Benefits Court Order (RBCO).
The TSP holds an individual account balance. The order assigns a share of that balance to the alternate payee. The alternate payee may keep their award in the TSP (in a beneficiary participant account) or roll it to an IRA.
The TSP has a fifth option not available in private plans: awarding 50% of the account balance that accrued between the Date of Marriage and a second date. This handles the pre-marital money problem without a separate calculation, so long as both dates are on or after January 1, 2003.
Balance − LoanBalance (loan added back)FERS is a federal defined benefit pension plan for civilian federal employees, administered by the Office of Personnel Management (OPM). It is not an ERISA plan. The order goes to OPM — not a QDRO.
FERS pays a monthly annuity at retirement based on years of service and salary. The standard division method is the time-rule formula: the alternate payee receives 50% × (FERS creditable service during the marriage ÷ total FERS creditable service) × the member's monthly annuity. OPM also accepts a percentage or flat dollar amount, but only post-retirement when a specific figure has been agreed upon.
Critical issue — survivor benefits: If the member dies before the alternate payee, the alternate payee's payments stop unless a former spouse survivor annuity is included in the order. Once the member retires without electing a survivor annuity, a court order cannot create one retroactively.
Military retired pay is divided under the Uniformed Services Former Spouses' Protection Act (USFSPA), 10 U.S.C. §1408. The order goes to DFAS (Defense Finance and Accounting Service). It is called a Qualifying Order for the Division of Military Retired Pay — not a QDRO.
Only disposable retired pay is divisible: gross retired pay minus any VA disability compensation waiver and SBP premium cost. VA disability pay itself is not divisible.
The 10/10 Rule: DFAS will only make direct payments to the former spouse if the marriage lasted at least 10 years and the member served at least 10 creditable years during the marriage. If the rule is not met, the court can still divide the pay but the former spouse must collect directly from the member.
SBP one-year rule: If the member is not yet retired at the decree date, the parties have ONE YEAR from the decree date to request DFAS "deem" an SBP election for former spouse coverage. Missing this deadline permanently eliminates SBP eligibility.
Railroad Retirement benefits are federal benefits for railroad employees under the Railroad Retirement Act, administered by the U.S. Railroad Retirement Board (RRB). The order is filed with the RRB under 20 CFR Part 295 — not a QDRO.
Only the non-Tier I (divisible) portion of Railroad Retirement benefits can be divided. Tier I benefits function like Social Security and are not divisible in divorce.
Division methods: Time-rule formula (most common): 50% × (months of railroad employment during the community interest period ÷ total months at retirement) × the monthly divisible benefit. The RRB also accepts a fixed percentage or a flat dollar amount per month.
ASRS is Arizona's defined benefit pension plan covering most state, county, municipal, and university employees. It is a governmental plan — the order is a Domestic Relations Order (DRO), not a QDRO.
ASRS pays a monthly annuity at retirement. The standard division is the time-rule formula: the alternate payee receives 50% × (ASRS service during the marriage ÷ total ASRS service at retirement) × the member's monthly benefit. ASRS also accepts a percentage or flat dollar amount, but only post-retirement when a specific figure has been agreed upon.
Reversion rule (A.R.S. §38-773(G)): If the alternate payee dies before the member, the alternate payee's entire benefit automatically reverts to the member. The alternate payee cannot leave their ASRS benefit share to their heirs.
ASRS Account Value Statement (AVS): A separate document ASRS generates on request, required by A.R.S. §38-773(B)(2). Different from a regular account summary — must be specifically requested from ASRS.
PSPRS covers Arizona police officers, firefighters, and corrections officers. CORP covers corrections officers. EORP covers elected officials. All are Arizona governmental plans — DROs, not QDROs.
The standard division is the time-rule formula: 50% × (service during marriage ÷ total credited service) × monthly pension. These plans also accept a percentage or flat dollar amount post-retirement when a specific figure has been agreed upon.
DROP and Reverse DROP: Members may participate in the Deferred Retirement Option Plan (DROP), accumulating pension benefits in a separate Nationwide account while continuing to work. CORP members may have a Reverse DROP lump sum. Both are separate from the monthly pension and must be addressed separately in the order.
Allows an eligible PSPRS member to continue working while their monthly pension benefit accumulates in a separate Nationwide/PSPDCRP account. The DROP balance is a lump sum separate from the monthly pension. Both must be addressed in the order.
A lump sum payment to a CORP member representing pension benefits for service prior to the actual retirement date. Separate from the monthly pension and must be addressed separately.
TSRS is a defined benefit pension plan for City of Tucson employees. It is a governmental plan — the dividing order is called an Acceptable Domestic Relations Order, not a QDRO. TSRS pays a monthly retirement annuity.
Division methods: The time-rule formula is standard: 50% × (TSRS service during the marriage ÷ total TSRS service at retirement) × the member's monthly annuity. TSRS also accepts a set percentage of the monthly annuity, used post-retirement when a specific figure has been agreed upon.
Survivor benefits: If the member dies before the alternate payee and there is no survivor benefit in place, the alternate payee's payments stop. The order can require a Joint & Survivor annuity naming the alternate payee as contingent annuitant with at least 50% survivor benefit. TSRS will not accept an election providing less than 50% survivor benefit to the alternate payee once the order requires one, and the member cannot change the election while the alternate payee is alive.
A 457(b) deferred compensation plan available to Arizona state, county, municipal, and other public employer employees, administered by Nationwide Retirement Solutions. Despite being a governmental plan, it is divided using a QDRO — the same four division formats as a private 401(k) apply.
The same pre-marital money considerations apply as for private DC plans. If the participant had money in the account before the marriage, a straight percentage award would include pre-marital funds. The parties must calculate the marital portion and express it as a dollar amount as of a specific date.
The exact legal name of the employer that sponsors the plan must appear in the order. The employer name is found on a recent Nationwide account statement.
Balance − LoanBalance (loan added back)Private employer defined contribution plans hold an individual account balance that grows through contributions and investment returns. These are ERISA plans — a QDRO is required to divide them in divorce.
The QDRO assigns a share of the vested account balance to the alternate payee. The alternate payee may roll their award to an IRA or, if the plan permits, to their own employer plan. The IRC §72(t) early withdrawal penalty is waived for QDRO distributions (but not IRA rollovers).
Pre-marital money: If the participant had money in the account before the marriage, the plan will not calculate the marital versus pre-marital portions. A straight percentage would give the alternate payee a share of money that was never community property. The solution is to determine the marital portion as of a specific date and award a dollar amount from that portion. Our office can assist with this calculation if account statements covering the full marital period are provided.
Plan name accuracy: The QDRO must name the exact legal plan name. The most reliable source is a recent account statement, verified against the Form 5500 at efast.dol.gov.
Balance − LoanBalance (loan added back)Private employer defined benefit pension plans pay a monthly benefit at retirement based on years of service and salary history — not an account balance. These are ERISA plans requiring a QDRO.
Division methods: The time-rule formula is standard: the alternate payee receives 50% × (service during marriage ÷ total service) × monthly benefit. This is a "separate interest" award — the alternate payee receives their own benefit payable over their lifetime, independent of the participant's elections. Plans also accept a percentage of the accrued benefit as of a specific date, or (post-retirement) a percentage or flat dollar amount.
Survivor benefits — usually not needed: In a pre-retirement separate interest award, the alternate payee's benefit is payable over their own lifetime — the death of the participant does not affect it. In a post-retirement order, the QDRO cannot change the form of benefit elected at retirement. In both cases, the parties generally do not need to address survivor benefits in the order.
IRAs are individual retirement accounts governed by IRC §408. They are not ERISA plans and do not require a QDRO. Division is accomplished by a court order or decree that specifically addresses the IRA. The custodian (brokerage or bank) transfers the awarded amount as a "transfer incident to divorce" under IRC §408(d)(6) — no tax consequences if done correctly.
The receiving spouse must have an IRA at the receiving institution, or open one. Traditional and Roth IRAs cannot be combined into a single transfer and must each be addressed separately.