{2 minutes to read} Often when people get divorced, they agree that either child support or maintenance (alimony) will be paid for some years into the future. For all kinds of reasons, both good and bad, payments are not made the way they’re supposed to be, and arrears accrue.
The person who is owed the money can sometimes collect by filing court papers to receive the money directly from the debtor’s paycheck. This is called a garnishment.
The same thing can be done using the Qualified Domestic Relations Order (QDRO) to collect from a 401(k) plan or a pension. Although collecting arrears is not the most common use of QDROs, it is a significant possibility for collecting arrears that have accumulated over the years.
The amount of arrears has to be established by the court. Then the QDRO has to be drafted, signed, and delivered to the pension plan. Once it is delivered, the amount will be paid in bulk from a 401(k). If it is a monthly pension, an appropriate amount will be subtracted from the payment and delivered to the person to whom it is owed. There are situations where thousands of dollars of arrears have been collected using this method.
It’s also worth noting that many couples agree that they will have a division of the retirement plans, like pensions and 401(k) plans, by QDRO — but never get around to it until years later. Even without the QDRO, monthly payments will add up and are collectible. The arrears owed as a result can likewise be added to what should be paid to the other spouse.
If a QDRO is put in place during a divorce negotiation, there should not be a problem of arrears due to the pension. However, any arrears from child support or maintenance (alimony) can still be collected through the QDRO. (For more on child support or maintenance arrears, see my article Using QDROs to Collect Child Support and Alimony.)
If you would like more information on this topic, please contact me.
Steven L. Abel, Esq.
101 South Broadway
Nyack, NY 10960
(P) 845-638-4666
(E) [email protected]
