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When a couple seeks a divorce, the Missouri law divides all marital property and finances. Real estate, personal property, and finances, including pension and retirement benefits are all divided by the Missouri court on the basis of equitable distribution. These tangible assets, if not managed well by the attorneys for the individual spouses, can result in added disputes, prolonging a divorce case. It is therefore essential for divorce seekers to have a clear understanding of how such benefits are assessed and divided by the Missouri law.
Understanding a Few Basics
It is important to understand certain terms and how the Missouri court works.- The Missouri law seeks a division of only marital property, that is, all property that was acquired or earned during or due to the marriage.
- Secondly, the Missouri court divides marital property by way of equitable distribution. This means, that the court will seek to divide property in a fair manner, which may not be equal.
Dividing Pension and Retirement Benefits
According to Missouri law, only those pensions and retirement benefits can be considered as marital property that was accumulated during the marriage. Most retirement plans and pensions acquired post-marriage can be designated as marital property. Other plans such as a Simplified Employee Pension plan, 401k accounts, 403(b) accounts, and simple and traditional IRAs also follow this rule. However, if a spouse has a retirement plan through the Public School Retirement System pursuant to Section 169.572 RSMo “in lieu” of accumulating credits towards social security benefits, it stands as an exception to the rule, as was ruled in a 2003 case – ‘In re the Marriage of Woodson’.Qualified Domestic Relations Order
The Qualified Domestic Relations Order, or the QDRO, are the directions the court sends to the administrator of a retirement plan. It outlines how the benefits of the retirement plan should be divided between the ex-spouses. The QDRO is often used for qualified defined benefit and contribution plans. These include the SEPs (Simplified Employee Pension Plans) 457s and 403(b) s.Methods of Distribution
The QDRO uses one of the following methods to divide pensions:- Shared interests – Shared interest directs the benefits towards both the pension-holder spouse as well as the non-holder spouse at the same time.
- Separate Interests – IN separate interests, the non-holder spouse can choose when to receive benefits.
- Qualified joint and survivor annuity – In this method, the non-holder spouse is granted survivorship rights.