Your retirement savings have a tremendous impact on your financial security, and protecting them during the marriage dissolution process is critical. Like all marital assets in a divorce, retirement plans including pensions and 401(k) accounts are subject to division between the parties. Because these holdings are highly regulated and often hold significant financial value, they should be handled properly and their treatment should be negotiated strategically to protect your interests. At the Law Offices of Randy S. Margulis in Williamsville and downtown Buffalo, our attorneys help position you for a stable financial future.
In New York State, 401(k) accounts, IRAs, pension plans and other retirement benefits earned during a marriage are considered marital property. In some circumstances, spouses may negotiate the asset division in a settlement process. This might be easier when both parties have substantial holdings in their own retirement accounts. In other cases, a stay-at-home spouse may be entitled to a certain percentage of their partner’s retirement account’s value based on the accrual that occurred while the couple was wed. That calculation can depend on the length of the marriage and other factors. A long marriage might result in 50 percent of the increase going to the stay-at-home spouse. A shorter marriage could lead to a lesser share.
Unlike a savings account, or even a house, retirement plans are complex financial instruments that usually cannot be liquidated without significant tax liabilities. Once a court decides, or the parties settle on, how retirement accounts should be distributed, our firm can notify the plan administrator regarding the arrangement and prepare a qualified domestic relations order (QDRO). In the case of government pensions, a domestic relations order (DRO) is used.
A QDRO declares how much each party will receive when the parties are eligible to receive benefits under the plan. Our experienced lawyers understand the importance of obtaining QDROs as soon as possible during the divorce process to prevent complications that can arise when a spouse tries drain assets from their retirement account or suffers an untimely death.
In high net worth divorce cases, one spouse may worry that the other one is hiding retirement accounts. Having a skilled divorce lawyer at your side who has experience dividing retirement assets during a divorce can help you obtain the benefits you’re entitled to by identifying accounts that might have been overlooked or hidden.
Achieving a fair property division in divorce usually requires a competent, experienced legal team. Our firm consults with experts when necessary to determine the true value of assets within the marital estate, including any retirement accounts. Not only is it critical that your family law attorneys understand the intricacies of financial instruments and the laws around their division in a divorce, they must also notify financial institutions promptly with the proper court order. We know that most divorcing spouses are looking to end the marriage dissolution process quickly, but we never lose sight of the fact that your future depends on carefully protecting the financial resources you’ll need in retirement.
Call the Law Offices of Randy S. Margulis today at 716-886-9600 or contact our firm online to schedule an initial consultation regarding retirement plan concerns and any other aspect of the divorce process. From our offices in Williamsville and downtown Buffalo, we represent clients throughout Western New York.
As a Buffalo divorce lawyer for 28 years, I have devoted myself to solving the problems that affect families throughout the Buffalo metropolitan area and Western New York. As a family law attorney, I make it my goal to create a partnership of trust with my clients. People put their trust in me to handle cases that can potentially have a long-lasting impact on not only their lives, but the lives of their family as well.
Alexandra M. Rockwood is a Senior Associate Attorney with the Law Offices of Randy S. Margulis & Associates and has been with the firm since early 2020. She primarily practices in the areas of matrimonial and family law, including divorce, child custody, and child support. Alexandra is a practicing matrimonial and family law attorney as…