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TAXES ON MY QDRO DISTRIBUTION
Obtaining a properly drafted Qualified Domestic Relations Order will ensure that you are not subject to the 10% excise tax (penalty tax) for distributions from retirement plans before the age of 59 ½. However, ordinary income tax will apply on any portion of transferred benefits that you do not rollover.
You do not need to decide what portion you intend to rollover until the QDRO process is complete. When the QDRO is finalized, you will have the legal right to contact the plan administrator directly regarding the plan’s distribution options. At which time, the plan administrator will provide you with an IRS mandated tax notice that provides detailed instructions about tax ramifications of the various distribution options.
All divorcing parties need a QDRO expert to advocate for their best interest.
QDROs are NEVER impartial documents.
Click here to learn more or to start the process.
