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Simple English definitions for legal terms
QDRO
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A quick definition of QDRO:
QDRO: A QDRO is a special order made by a court that allows someone to get part of the money from a pension plan. This happens when a married couple gets divorced and one person needs money from the other person's pension plan. The court makes the QDRO to say who gets the money and how much. Only certain people can get the money, like the ex-spouse or children.
A more thorough explanation:
QDRO stands for qualified domestic relations order. It is a type of court order that deals with the division of retirement benefits in a divorce or separation.
When a couple gets divorced, they may have to divide their assets, including any retirement benefits. A QDRO is a legal document that allows the non-employee spouse to receive a portion of the employee spouse's retirement benefits.
For example, if John and Jane get divorced and John has a 401(k) plan, Jane may be entitled to a portion of that plan. A QDRO would be used to divide the plan and ensure that Jane receives her share of the benefits.
It's important to note that a domestic relations order only becomes a QDRO when it meets certain requirements. The order must create or recognize an alternate payee's right to receive all or part of the participant's benefits, and the alternate payee can only be the participant's spouse, former spouse, child, or other dependent.