You Need A Skilled Lawyer For Retirement Asset Division
At Butler Giraudo & Meister, P.C., our attorneys handle retirement asset division for clients in Peoria, Tazewell and Woodford Counties and throughout Central Illinois. We are experienced in dividing complex financial assets, including retirement benefits, for men and women going through divorce.
Dividing Retirement Assets In Illinois
Since 1985, Illinois law has recognized retirement assets such as 401(k)s, pensions, annuities, or any other employer-sponsored plan as marital property. Typically, any portion of the retirement asset that accrued during the marriage is considered marital property and can be divided between the parties. Any portion of the retirement asset that the employee earned prior to the marriage or after the date of the dissolution of marriage is classified as non-marital property. As non-marital property, that portion will be assigned to the employee-spouse, not allocated to the nonemployee-spouse.
Illinois law established the use of the “Hunt formula”, to divide retirement assets, which was created in the case “In Re Marriage of Hunt.” The formula is structured such that the employee and the spouse generally receive 50 percent of the marital interest in every retirement asset.
Domestic Relations Orders
A domestic relations order is a court order assigning a spouse the right to receive all or a portion of the benefits under a retirement plan. Most commonly, qualified domestic relations orders (QDROs) are created to divide retirement assets that are governed by ERISA, which includes most employer-provided benefits in the private sector. Illinois domestic relations orders, on the other hand, are specifically designed to divide the marital interest in state retirement benefits for:
- State employees
- Municipal employees
- Law enforcement and firefighters
For federal employees, such as civil servants, the Federal Employment Retirement System (FERS) has its own rules and requirements. The military also has special procedures for dividing military retirement benefits.
It is crucial to hire an attorney who is knowledgeable not only in the interests of the plan, but also in drafting these highly technical legal documents. Our lawyers have that experience and can help you through the process of valuing and dividing complex retirement assets.