of Division -
There are two ways to determine the amount of money to be distributed
to the Former Spouse under a QDRO in a Defined Contribution Plan.
A percentage of the account can be used, or an actual dollar amount.
When a percentage of the account is used, normally the Time Rule
is utilized to determine what percentage of the account the Former
Spouse will get. The Time Rule is computed as follows:
Number of months during marriage participant was in the Plan
through date of division, divided by the Total number of months
participant was in the Plan through date of division
This fraction will give you the approximate community property
share of the account. IF you want an exact amount of the community
property share that computates the actual timing of the gains
and losses in the account, you would need an actuary or accountant
to do this calculation. This amount would then be divided in
two to determine how much the Former Spouse is entitled to at
date of division.
Employer - This
would apply to any Non-Civilian Military Personnel. Civilian Military
Personnel are considered Non-Military Government Employees.
Annuity - Under
the Federal Plans this is the amount of monthly annuity payable
after deducting from the gross annuity any amounts (1) owed by
the retiree to the United States; (2) deducted for health benefit
premiums; (3) deducted for life insurance premiums; (4) deducted
for Medicare premiums; (5) property withheld for Federal Income
tax purposes; (6) property withheld for State income tax purposes.
It includes lump sum payments, if any, made to the retiree under
section 8343a or 8420a of Title 5, United States Code, unless
the court provides otherwise.
Retirement Age -
The age at which a participant can retire under the plan and receive
a full pension benefit. In most cases, the normal retirement age
will not be greater than 65 years of age.
A member of a pension plan. A participant is said to participate
in or be covered by the plan. The Participant is the spouse whose
retirement plan you are dividing. The spouse that is to receive
benefits under the QDRO is the Alternate Payee.
- The Petitioner is the party that initiated the dissolution
The person or persons who administer the plan. Sometimes the Plan
Administrator is the employer, sometimes it is a third party.
If the name of the administrator is not in the plan document,
the employer is considered to be the plan administrator. You can
also obtain this information from Retirement Plan Statements,
a Summary Plan Description, or a telephone call to the Retirement
Plan or the Employer.
Private Employer - This would be any employer that is not a government
entity. This would also apply to those that are self-employed.
Domestic Relations Order (QDRO) -
A QDRO is a domestic relations order that gives an alternate payee
the right to receive all or a portion of the benefits payable
to a participant under the plan, and meets certain other legal
requirements with respect to the information and benefits involved.
Joint and Survivor Annuity (QJSA) -
A Qualified Joint and Survivor Annuity, (QJSA) is a joint and
survivor annuity where (1) the participant receives a definite
amount of money at regular intervals for life, and (2) after the
participant dies, the surviving spouse receives a definite amount
of money (not less than 50% or more than 100% of the participant's
amount) at regular intervals for life. The Former Spouse may be
disgnated as the Surviving Spouse and therefore the beneficiary
of the Surviving Spouse Annuity. When a QJSA is elected by the
Participant the monthly retirement benefit will be lower to pay
for the Surviving Spouse's benefit, since the Plan will have to
pay money over the lifetime of both the Participant and the Surviving
Spouse. This benefit can be paid for by the Participant, Former
Spouse or both.
Preretirement Survivor Annuity (QPSA) -
A QPSA is a benefit that is paid to the named beneficiary in the
event that the Participant dies before retirement benefits have
commenced. If this option is not selected the Former Spouse may
forfeit all retirement benefits if the Participant dies before
the Former Spouse commences benefits.
Enhancements - Employers
offer Early Retirement Subsidies or other Retirement Enhancements.
Under California law the Former Spouse is entitled to these Enhancements
unless they are specifically waived by the Former Spouse.
Under the Federal Plans, this is the amount of monthly recurring
payment to a retiree who has elected not to provide a survivor
annuity to anyone. Unless the court order provides otherwise,
it also includes lump sum payments, if any, made the retiree under
Section 8343a or 8420a of Title 5, United States Code.
Life Annuity -
An annuity that pays benefits over the Participant's lifetime.
Also known as a straight-life annuity. Once the Participant dies,
there are no further annuity payments.
Husband or wife as determined under applicable state law. A QDRO
can provide that the participant's former spouse be treated as
the participant's spouse.
A spouse's agreement to allow the participant to waive the QPSA
or elect a form of benefit other than QJSA.
The benefit a survivor receives after the participant dies.
Life Annuity - An
annuity that pays benefits over the shorter of the recipient's
life or a specified period.
This formula can be used to determine the community property share
of benefits in both a defined contribution plan and a defined
benefit plan. The Time Rule is computed as follows:
Number of months during the marriage participant was in the
Plan through determination date, divided by the Total number
of months participant was in the plan through determination
date. This fraction will give you the community property share
of the benefit. This amount would then be divided in two to
determine how much the Former Spouse is entitled to at determination
Determination date can be either, Date of Separation, Date of
Dissolution, Date of Retirement, Date of Division, or some other
date agreed upon by the parties.
actuarially estimated amount needed at a point in time to provide
monthly benefits in the future. Value depends on the amount of
the monthly benefit payment, when the benefit payments start and
stop, age(s) of the recipient(s), mortality assumptions, and interest
assumptions. Also referred to as "present value" or
"actuarial present value."