As Michigan couples negotiate divorce settlements, they might include a QDRO as part of their property division. QDRO stands for qualified domestic relations order, and it establishes that a person can receive payments from their ex-spouse’s retirement plan.

However, there are stipulations attached to a QDRO. The domestic relations order must be issued by a court, and it must be accepted by the retirement plan to become qualified. The QDRO must include the name and mailing address of the plan participant and the alternative payee as well as the percentage of the payment that the payee will receive.

Usually, these orders are filed during the divorce, but it is possible to file the order years later. If an order is filed later and the participant has already begun to receive payments, the new terms only apply to future payments. If an order is filed after the divorce, and the divorce settlement did not include the retirement account, it becomes more difficult to acquire a QDRO as the person seeking it must get a lawyer and file to reopen the divorce. This process can take many years.

QDROs are issued for retirement plans sponsored by private organizations or non-profits. Similar orders have different names. For retirement plans for federal government employees, the order is called a COAP, which stands for court order acceptable for processing. This is a benefit that should not be overlooked when negotiating property division as retirement accounts can be very valuable assets.

The divorce process can be complex and include many different aspects, such as property division. Michigan residents beginning the process might find it beneficial to consult with a lawyer with family law experience. A lawyer may offer legal guidance as well as support in gathering documents before the process begins, filing orders with the court and representing clients during negotiations and court appearances.