Breaking Up is Hard to Do: QDRO Administration and Carving-Up a Participant’s Plan Benefit

Recordkeepers and sponsors must know how to divide a participant’s plan benefit in the context of a divorce or legal separation and issuance of a domestic relations order that seeks to assign part of a participant’s benefit to a spouse or former spouse. Follow this process map and the related content to learn more about approving and administering qualified domestic relations orders (QDROs).

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Related Content

• QDRO Rules and Review Procedures
  Learn more about how the QDRO rules establish an exception to ERISA's anti-alienation and preemption provisions by permitting a qualified ERISA retirement plan to accept and implement a nonparticipant's claim, awarded in a state domestic relations matter, to a share of a plan participant's account or accrued benefit in a qualified plan.
• QDRO Resource Kit
  Reference this resource kit setting forth Practical Guidance materials in the form of practice notes, templates, and checklists designed to help ensure compliance with the QDRO rules.

Legal Developments

• Addressing Employee Health Plan Dependent Exception Requests
  This article addresses employer considerations when responding to requests to enroll an ineligible dependent in an employer health plan.
• In ERISA Excessive Fee Cases, the Pendulum May Be Swinging Back in Favor of Plan Sponsors
  The Seventh circuit, in Albert v. Oshkosh Corp., decided to apply a narrow interpretation of Hughes v. Northwestern Univ., which the Supreme Court issued earlier this year.
• DOL Proposal May Disrupt Plan Sponsor Investment Arrangements
  The U.S. DOL recently proposed significant changes to the qualified professional asset manager (QPAM) prohibited transaction exemption widely used by asset managers for nearly four decades.

Practical Guidance Updates
Featuring the latest updates from your Practical Guidance account.  

• Employee Benefits & Executive Compensation Key Legal Developments Tracker
  Stay informed on new developments.
  • Retirement Plans. IRS announces that it will issue final regulations related to required minimum distributions (RMDs) under IRC Section 401(a)(9) that will apply beginning with the 2023 distribution calendar year and that provides Section 401(a)(9) guidance for the 2021 and 2022 distribution years. Notice 2022-53.
  • Employment, Independent Contractor, and Severance Arrangements. DOL proposes a new rule that would update the requirements for whether a worker is an independent contractor or an employee under federal law. DOL also officially rescinds the Trump administration's rules on joint employer status and independent contractor classification. DOL News Release; 87 Fed. Reg. (Oct. 13, 2022); 86 Fed. Reg. 14,027 (March 12, 2021).
  • Executive Compensation. SEC issued a final rule to Item 402 of Regulation S-K to implement Section 14(i) of the Securities Exchange Act of 1934 requiring registrants to disclose in a clear manner the relationship between executive compensation actually paid and the financial performance of the registrant in proxy statements or information statements in which executive compensation disclosure is required. 87 Fed. Reg. 55,134 (Sept. 8, 2022).
• Document alerts allow you to stay current on legal developments that affect your practice. Find out how to set up your document alerts.
• Check out the new Practical Guidance Author Center! Learn about the 1500+ leading attorney authors contributing to our 22 practice areas, and find out how you can Become a Practical Guidance Author.
• Listen up! Access our growing collection of podcasts by navigating to the Practical Guidance Podcasts Resource Kit.
• Share the First Year Associate Resource Kit: Employee Benefits & Executive Compensation with your firm’s associates to help them sharpen their research and writing skills, get the inside scoop on associate survival, and hit the ground running.  
• The Practical Guidance Journal Fall Edition features impacts of the Dobbs v. Jackson Health Organization decision on employers, healthcare, insurance, and privacy concerns, and tracks the status of state law changes.

• New and Updated Practical Guidance Content
  • State Abortion Laws Tracker After Dobbs v. Jackson Women's Health Organization
  • Section 125 Cafeteria Plan Rules Video
  • ACA Nondiscrimination Rules for Health Programs and Activities (ACA Section 1557)
  • Defined Contribution Plan Notices (Plan Events)
  • Equity Incentive Compensation Plans for Start-Ups
  • Investment Review Checklist for Investment Committee (401(k) Plan)
  • Open Enrollment Notices Checklist (Health and Welfare Plans)
  • Medicaid and Children's Health Insurance Program (CHIP) Notice

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