Who receives this pension after the death of a divorced person?
Q. I have a work pension and the court decided when I got divorced that my ex would get half of it. If he dies, is his new wife or their other children – not our children – entitled to his half or is it mine?
A. Yours is an important question.
But the answer will largely depend on the language of your divorce decree and the language included in the Qualified Domestic Relations Ordinance (QDRO), the document which facilitates the division of the pension.
If the court has determined that your ex-husband should receive half of your pension after the divorce, it will most likely be necessary that a QDRO be, or have been, prepared and served on your pension plan administrator, said Jeralyn Lawrence. , family lawyer at Lawrence Law in Watchung.
She said the QDRO language is guided by the terms of your divorce decree and / or your marriage settlement agreement, which should indicate how the pension assets are to be distributed among the divorced spouses.
The question of whether your ex-husband’s benefits would continue to be paid to his then surviving spouse at the time of his death, or to his then surviving children who were not born to your relationship with your ex-husband, is determined. by the policies and procedures of the plan themselves, âsays Laurent. âIt would be important to know how your pension plan is held – privately, publicly, through the government or the military and so on. – and if you were employed at the time of your divorce, or if you had not yet chosen a form of payment of benefits at that time.
In general, she said, if your pension was divided into QDRO causing your ex-husband to receive 50% of your pension, the QDRO will most likely have wording describing whether his share goes to you, goes to his estate, or is forfeited to the pension plan. The summary description of your pension plan might provide additional information useful in answering your question, Lawrence said.
She said there are two basic ways of dividing a pension.
The first approach used in some QDROs aims to âSplitâ actual benefit payments to a participant under the plan to give the alternate beneficiary a portion of each payment, Lawrence said.
âThis pension benefit allocation approach is often referred to as the ‘shared payment’ approach, in which the alternate beneficiary will not receive any payment unless the participant is in receipt of a payment or is already in pay,â he said. she declared. “Therefore, this approach should be used when a participant is already on payroll.”
A QDRO under this approach should specify the amount or percentage of participant benefit payments that are allocated to the alternate beneficiary and must specify when the alternate beneficiary’s right to split payments begins and ends, she said. declared.
âIf you were employed at the time of your divorce from your ex-husband and you were receiving benefits in the form of a single life annuity, the payments of which would end at the time of your death, your ex-husband’s share would either amount to you or the plan when it predeceased you – unless the plan gives them the right to transfer their benefits to another potential beneficiary under the specific language of the QDRO “, Laurent said.
Alternatively, QDROs that intend to divide a marital property retirement benefit during a divorce typically divide the member’s retirement benefit – rather than just the payments – into two separate parts for the purpose of giving the alternate beneficiary has a separate right to receive a portion of the retirement benefit payable at a time and in a form different from that chosen by the participant, Lawrence said.
“This approach to sharing a pension benefit is often referred to as the ‘separate interest’ approach,” she said. âThis method is typically used when the QDRO is in place before the participant’s benefits are paid. “
A QDRO under this approach must specify the amount or percentage of the member’s retirement benefit to be awarded to the alternate beneficiary and the number of payments or the period to which the benefit applies, she said.
If you were not employed at the time of your divorce and had not chosen a form of benefit payment at retirement, your ex-husband would have the option of choosing a form of benefit payment applicable to his share of profits, as the plan allows, she said.
Lawrence gave this example: If a plan offered you the option of receiving a “fixed-term annuity” which consists of monthly payments for a defined period, such as 15 years, your ex-husband would also have been allowed to choose a certain annuity period. With respect to its share of benefits. If he died before the expiration of the guaranteed period, the plan would continue to make payments to its designated beneficiary. In this sense, your ex-husband would benefit from the rights which are also granted to you, namely the right to appoint a third party to receive unpaid benefits upon his death. In that case, your ex-husband’s share might not come back to you, she said.
âIt’s important to notify your plan of the death of your ex-spouse so that the plan can act on it,â Lawrence said. “If you are unable to obtain a copy of your QDRO, or if you cannot remember whether a QDRO has been entered, you should speak to the plan administrator or a family lawyer who may try to get a copy for you.
Email your questions to [email protected].
Karin Price Mueller writes on Bamboo column for NJ Advance Media and is the founder of NJMoneyHelp.com. Follow NJMoneyHelp on Twitter @NJMoneyHelp. Find NJMoneyHelp on Facebook. Register for NJMoneyHelp.com‘s weekly electronic newsletter.