Use a QDRO to divide qualified plan assets in divorce

Description

Abstract: When qualified plan assets are divided in divorce, a qualified domestic relations order (QDRO) is critical. Without a QDRO, distributions from a qualified retirement plan to an ex-spouse are fully taxable to and not deductible by the first spouse. In contrast, distributions under a QDRO are taxed to the recipient when received by that person. This article examines the details.