How to Ensure You’re Getting (or Protecting) Your Fair Share
If you are facing a divorce, you’re likely concerned about how your “assets” or simply, the things that you and your spouse own together, will be divided. In California, property is categorized before it is divided. Everything that the two of you own will be designated as “community property” or “separate property”. One of the most valuable things people own is their 401(k), IRA, or other retirement accounts, so it’s very important to closely examine how money in a retirement account will be divided.
How Are Assets Divided in a Divorce?
Obviously if you have $1000 in cash, each person would take $500. However, the reality of property division is that almost NO asset is that straightforward. Houses, cars, savings accounts that existed before the marriage all create their own unique challenges in determining how to fairly categorize and then divide them. IRAs, 401(k) and other retirement accounts used to create a challenge because they have a unique tax status and cannot be “liquidated”, meaning you typically pay early-withdrawal penalties if you deduct money from certain types of retirement accounts.
How Are Retirement Accounts Divided?
The QDRO, or Qualified Domestic Relations Order is a special court order to divide the 401(k), IRA, or other retirement account without changing the account’s tax status. Instead, the retirement account is split into two accounts and then renamed for the individual spouses.
Will the Retirement Account Be Divided 50/50?
That is a question of how the funds in the retirement accounts will be categorized; community property or separate property. While each case is unique, generally the funds would be considered community property and would be split 50/50 if the income that contributed to the retirement account was earned while the two spouses were married.
Could My Spouse Have Retirement Accounts I Don’t Know About?
It’s possible. If you suspect that your spouse is hiding money or that there are accounts you are unaware of, talk to a lawyer today. If you choose to work with us, we will do a detailed financial overview of your situation and ensure that you are getting the funds that you are entitled to.
Beverly Hills Divorce Lawyer – Experienced in Retirement Accounts and Complex Financial Situation
No matter what type of complex financial situation you are facing in your divorce, we can help. We have experience in handling very large asset division cases and work with a network of financial experts and forensic accountants when needed. At The Law Offices of Michael L. Maguire & Associates, our team will work with you each step of the way towards the best possible outcome. To learn more about how we can help you, contact our office today.